Getting to Know The Numbers

1. Comparison Report
2. Stock Valuation
3. Dividends
4. Growth Rates
5. Financial Strength
6. Profitability
7. Management Effectiveness
8. Efficiency

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Fundamental Analysis - Comparison Report

The Market Guide Ratio Comparisons Report is where you really "separate the wheat from the chaff." For this Report to work most effectively, you should already have formed a favorable general impression of the stock based on your review of the Report, and you should come away from the your review of the Price Chart, company News and the reports in the Highlights, Estimates and Performance categories with a reasonable understanding of what is occurring with the company and its stock. But however much information you have gleaned to this point, it's important to remember that no company exists in isolation.

The seven comparison tables presented here are designed to show you where a company stands in relation to others. For example, you may know by now that your company has a Return on Equity of, say, 14%. Is that good? Is this a successful company? You won't be able to answer that question until you see how that number compares with key benchmarks. A 14% Return on Equity may look good compared to the returns offered by U.S. Government bonds. But suppose the average Return on Equity for the S&P 500 is above 20%. Or, perhaps, the company's average Return of Equity over the past five years was 22%. Such comparisons would make a recent 14% tally look less appealing. But don't jump too quickly to a conclusion. Suppose the average Return on Equity for the Industry in which the company operates is 11%, and that the average Industry ROE for the past five years was 19%. Now, the picture changes. We see that the company's ROE, although not superlative, is superior to the lackluster returns posted by others in its industry. Many other data items need to be examined the same way.

This can become extremely cumbersome. But that won't happen if you use the Market Guide Comparison Report. It presents a group of easy-to-read tables showing you how the company measures up against each of three different peers groups in terms of 49 factors (recent and historical) in seven important categories. The peer groups are the S&P 500, the benchmark most frequently used to measure a particular company/stock against the overall equity market, the industry in which the company operates, and a sector comprised of other similar industries. (Below the data tables, you can see a specific list of all other companies in the same industry, and a list of all industries within the sector.) It will only take a few minutes for you to determine whether your company is a leader or a laggard.

Below is a sample of a complete Ratio Comparisons report on McDonald's. You can use the side menu to select more detailed discussions of the components.

RATIO COMPARISON
Valuation Ratios Company Industry Sector S&P 500
P/E Ratio (TTM) 39.55* 34.27 34.88 37.65
P/E High - Last 5 Yrs. 34.48 35.19 41.95 42.70
P/E Low - Last 5 Yrs. 17.54 16.64 16.17 14.50
Beta 0.97 0.95 0.89 1.00
Price to Sales (TTM) 4.93* 3.48 4.29 5.76
Price to Book (MRQ) 6.60 5.50 6.88 8.67
Price to Tangible Book (MRQ) 6.60 5.73 9.64 12.34
Price to Cash Flow (TTM) 24.61 21.93 23.35 28.13
Price to Free Cash Flow (TTM) 133.00 31.16 54.59 49.89
% Owned Institutions 69.77 56.48 52.58 63.94

Dividends Company Industry Sector S&P 500
Dividend Yield 0.46 0.53 1.57 1.52
Dividend Yield - 5 Year Avg. 0.60 0.51 1.37 1.89
Dividend 5 Year Growth Rate 10.41 9.59 7.29 10.19
Payout Ratio (TTM) 87.43 54.77 26.99 32.32

Growth Rates(%) Company Industry Sector S&P 500
Sales (MRQ) vs Qtr. 1 Yr. Ago 9.08* 7.92 19.47 12.28
Sales (TTM) vs TTM 1 Yr. Ago 8.88* 8.30 26.89 14.72
Sales - 5 Yr. Growth Rate 9.85 13.15 22.43 16.65
EPS (MRQ) vs Qtr. 1 Yr. Ago -13.79* 5.39 25.44 8.51
EPS (TTM) vs TTM 1 Yr. Ago -3.92* 3.84 23.49 11.18
EPS - 5 Yr. Growth Rate 12.66 14.13 21.84 20.63
Capital Spending - 5 Yr. Growth Rate 14.20 15.81 28.30 15.81

Financial Strength Company Industry Sector S&P 500
Quick Ratio (MRQ) 0.39 0.45 0.94 0.97
Current Ratio (MRQ) 0.58 0.71 1.48 1.47
LT Debt to Equity (MRQ) 0.71 0.63 0.89 0.67
Total Debt to Equity (MRQ) 0.79 0.69 1.03 0.97
Interest Coverage (TTM) 6.94 7.17 5.59 9.06

Profitability Ratios (%) Company Industry Sector S&P 500
Gross Margin (TTM) 36.16 36.81 43.07 48.94
Gross Margin - 5 Yr. Avg. 37.80 36.85 42.17 48.68
EBITD Margin (TTM) 30.49 23.11 19.81 22.48
EBITD - 5 Yr. Avg. 33.18 24.45 20.73 22.07
Operating Margin (TTM) 23.20 16.76 9.26 17.69
Operating Margin - 5 Yr. Avg. 25.91 18.06 10.94 17.85
Pre-Tax Margin (TTM) 19.59 14.14 10.32 14.77
Pre-Tax Margin - 5 Yr. Avg. 21.92 15.20 9.71 16.01
Net Profit Margin (TTM) 12.48* 8.95 5.86 10.72
Net Profit Margin - 5 Yr. Avg. 14.60 11.25 5.54 10.29
Effective Tax Rate (TTM) 32.27 33.45 37.30 34.19
Effective Tax Rate - 5 Yr. Avg. 33.32 33.80 36.83 35.70

Management Effectiveness (%) Company Industry Sector S&P 500
Return On Assets (TTM) 8.30* 7.03 5.18 8.45
Return On Assets - 5 Yr. Avg. 9.47 8.76 5.08 8.29
Return On Investment (TTM) 9.45* 8.09 7.50 13.51
Return On Investment - 5 Yr. Avg. 10.91 10.23 8.03 13.07
Return On Equity (TTM) 17.34* 16.44 15.13 23.05
Return On Equity - 5 Yr. Avg. 19.52 17.20 15.28 21.49

Efficiency Company Industry Sector S&P 500
Revenue/Employee (TTM) 46,522* 65,265 331,939 391,610
Net Income/Employee (TTM) 5,806* 5,927 51,075 59,543
Receivable Turnover (TTM) 23.63* 31.28 15.56 9.99
Inventory Turnover (TTM) 112.94 35.13 14.01 9.02
Asset Turnover (TTM) 0.67* 1.03 1.17 1.10

50 Companies in the Restaurants industry listed in order of descending market capitalization.
MCD YUM WEN DRI OSSI EAT PZZA SDH CBRL
CKR FM BOBE APPB RI CEC SBA SONC RYAN
CAKE BOCB COP IHOP STAR NPCI LUB PFCB DANB
MHI AVDO HMS CHUX DINE LDRY RARE PHL VRES
SHN RAIN TACO PJAM PIC KKRE MRG LTUS UNO
BUNZ BREW UNIQ ABPCA
Alphabetical Listing of all Industries in theServicesSector
Advertising
Broadcasting & Cable TV
Business Services
Casinos & Gaming
Communications Services
Hotels & Motels
Motion Pictures
Personal Services
Printing & Publishing
Printing Services
Real Estate Operations
Recreational Activities
Rental & Leasing
Restaurants
Retail (Apparel)
Retail (Catalog & Mail Order)
Retail (Department & Discount)
Retail (Drugs)
Retail (Grocery)
Retail (Home Improvement)
Retail (Specialty)
Retail (Technology)
Schools
Security Systems & Services
Waste Management Services

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