After a recent market review, we can see that Johnson Matthey Plc (JMAT.L) has a Shareholder Yield of 0.022928. This is calculated by adding the dividend yield to the percentage of repurchased shares. Shareholder yield has the ability to show how much money the firm is giving back to shareholders via a few different avenues. Companies may issue new shares and buy back their own shares. This may occur at the same time. Investors may also use shareholder yield to gauge a baseline rate of return.
As we sail into the second half of the calendar year, investors may be looking to see what has gone right and what has gone wrong so far this year. Making necessary changes to some holdings may help position investors for the next couple of quarters. Being able to cut the riskier losers and take some profits from winners may help solidify the stock portfolio. As we run through the next round of company earnings reports, investors will be keeping a close eye on the data that is reported. Investors may be looking to buy companies that continue to post beats on the earnings front, and cut ties with ones that are not hitting their marks.
Return on Invested Capital (ROIC), ROIC Quality, ROIC 5 Year Average
The Return on Invested Capital (aka ROIC) for Johnson Matthey Plc (JMAT.L) is 0.20488. The Return on Invested Capital is a ratio that determines whether a company is profitable or not. It tells investors how well a company is turning their capital into profits. The ROIC is calculated by dividing the net operating profit (or EBIT) by the employed capital. The employed capital is calculated by subrating current liabilities from total assets. Similarly, the Return on Invested Capital Quality ratio is a tool in evaluating the quality of a company’s ROIC over the course of five years. The ROIC 5 year average is calculated using the five year average EBIT, five year average (net working capital and net fixed assets). The ROIC 5 year average of Johnson Matthey Plc (JMAT.L) is 0.228025.
Return on Assets
There are many different tools to determine whether a company is profitable or not. One of the most popular ratios is the “Return on Assets” (aka ROA). This score indicates how profitable a company is relative to its total assets. The Return on Assets for Johnson Matthey Plc (JMAT.L) is 0.072792. This number is calculated by dividing net income after tax by the company’s total assets. A company that manages their assets well will have a higher return, while a company that manages their assets poorly will have a lower return.
Price Index (all months)
The Price Index is a ratio that indicates the return of a share price over a past period. The price index of Johnson Matthey Plc (JMAT.L) for last month was 1.075609 while the 3m is at 1.152933. This is calculated by taking the current share price and dividing by the share price at the specifiied time frame mentioned. If the ratio is greater than 1, then that means there has been an increase in price over that timeframe. If the ratio is less than 1, then we can determine that there has been a decrease in price. Similarly, investors look up the share price over 12 month periods. The Price Index 12m for Johnson Matthey Plc (JMAT.L) is 1.063124. The Price Index 5Y stands at 1.232777.
Free Cash Flow Yield (FCF Yield) is the free cash flow of the current year minus the free cash flow from the previous year, divided by last year’s free cash flow. The FCF Growth of Johnson Matthey Plc (JMAT.L) is 0.015581. Free cash flow (FCF) is the cash produced by the company minus capital expenditure. This cash is what a company uses to meet its financial obligations, such as making payments on debt or to pay out dividends. Looking out to the 5 year FCF yield, this gives investors the overall quality of the free cash flow over a longer period of time. The FCF five year yield for Johnson Matthey Plc (JMAT.L) stands at 0.037969. Experts say the higher the value, the better, as it means that the free cash flow is high, or the variability of free cash flow is low or both.
Johnson Matthey Plc (JMAT.L) based out of United Kingdom and resides in the Materials sector, has a market cap of 7549579.946 after recently touching 34 on a recent bid. Johnson Matthey Plc (JMAT.L) sees an average of trading volume of 16932.63261. Johnson Matthey Plc (JMAT.L) competes in the Chemicals industry.
Checking in on some valuation rankings, Johnson Matthey Plc (JMAT.L) has a Value Composite score of 20. Developed by James O’Shaughnessy, the VC score uses five valuation ratios. These ratios are price to earnings, price to cash flow, EBITDA to EV, price to book value, and price to sales. The VC is displayed as a number between 1 and 100. In general, a company with a score closer to 0 would be seen as undervalued, and a score closer to 100 would indicate an overvalued company. Adding a sixth ratio, shareholder yield, we can view the Value Composite 2 score which is currently sitting at 16.
Johnson Matthey Plc (JMAT.L) has a current MF Rank of 1944. Developed by hedge fund manager Joel Greenblatt, the intention of the formula is to spot high quality companies that are trading at an attractive price. The formula uses ROIC and earnings yield ratios to find quality, undervalued stocks. In general, companies with the lowest combined rank may be the higher quality picks.
Studies have shown that combining the Magic Formula with for instance the Piotroski F-Score increases return. If for instance you take the top 20% results of the magic formula and then take the 20% of stocks with the highest 6-month price index, the total return increases from 235% to 784% during the period 1999-2011.
There are many factors at play when looking to successfully conquer the stock market. New investors have the tendency to become overwhelmed at the prospect of putting their hard earned money to work. If the individual investor decides that they are going to be managing their own money, they may be looking for a proper place to start. Investors might want to start by clearly defining their own goals. Creating realistic and attainable goals can help get the investor walking down the right path. As many experienced investors know, setting goals and staying on track can be a big help for navigating the markets.