Critical Profitability Ratio Analysis: Reynolds American (NYSE:RAI), Dr Pepper Snapple Group (NYSE:DPS)

Reynolds American Inc. (NYSE:RAI) kept active in profitability ratio analysis, on current situation shares price are increasing -0.15% to $61.30. The total volume of 5.25 Million shares held in the session, while on average its shares change hands 7470.09 shares.

Efficiency Evaluation in Focus

Entering into profitability analysis, the co has noticeable returns on equity ratio of 28.30%, which discloses how corporation’s management efficiently generates profit from shareholders invested money. The returns on investment very popular metric among passive investors, it stands at 19.90%, when it lies in positive figure than security is feasible for investment or goes for higher ROI stocks. To see the other side of picture, profit margin of RAI stands at positive 48.60%; that indicates a firm actually every dollar of sales keeps in earnings. The 11.60% returns on assets present notable condition of firm. Mostly ROA known as a comparative measure, it is best to compare it against a firm’s previous ROA numbers or the ROA of a same firm.

To find out the technical position of RAI, it holds price to book ratio of 4.02 that unearth high-growth companies selling at low-growth prices, but it requires appropriate measurement approach. It has forward price to earnings ratio of 22.05, and price to earnings ratio calculated as 14.44. The price to earnings growth ration calculated as 1.43. RAI is presenting price to cash flow of 42.76.

Dr Pepper Snapple Group, Inc. (NYSE:DPS) also listed in significant eye catching mover, DPS attains returns on investment ratio of 14.60%, which suggests it’s viable on security that has lesser ROI.

To strengthen this concept we can use profit margin, which is standing at positive 13.20%, and it is providing insight view about a variety of aspects of a firm’s financial performance. The gross profit margin can be giving more focus view that is 21.80% and 59.90% respectively. Turns back to returns ratios, the co’s returns on assets calculated as 14.60%; that gives an idea as to how efficient management is at using its assets to generate earnings. Finally yet importantly, returns on equity stands at 39.80%.

EPS estimates indicating constrictive facts, the current year from sell-side analysts, Price to current year EPS stands at 14.30%, and looking further price to next year’s EPS is 8.98%. While take a short look on price to sales ratio, that was 2.69 and price to earning ration of 20.79 attracting passive investors.

 

About Blake Escott

Blake Escott holds junior writer position in SWR. Before joining Streetwise Report, he was a freelance content Writer. He has high-level copywriting experience and particularly experienced in proofreading and editing. He covers news about different companies including all US market sectors. Interests: Commodities, Energy stocks, Sector-wise Stocks analysis, Utilities

Leave a Reply

Your email address will not be published. Required fields are marked *