Wednesday, December 29, 2010

Researching Your Dividend Bse Nse Stock Picks with Important Formulas

As with all stocks, you should research the dividend stocks you’re considering before you buy them to ensure they’re good investments. These formulas help you determine whether a stock’s dividend and other markers are sufficient to meet your needs. Check out the company’s balance sheet, income statement, and cash flow statements for the figures you need to crunch the numbers using the following formulas.

Dividend Per Share (DPS)
Total Dividends ÷ Total Shares = Dividend Per Share (for the quarter)
$_______________ ÷ _______________ shares = $_______________ DPS
Indicated Dividend Per Share (IDS)
Dividend Per Share (DPS) x 4 = Indicated Dividend Per Share
$_______________ x 4 = $_______________ IDS
Yield
Indicated Dividend Per Share ÷ Share Price = Yield
$_______________ ÷ $_______________ = _______________ % Yield
Earnings Per Share (EPS)
Net Profit ÷ Total Shares Outstanding = Earnings Per Share
$_______________ ÷ _______________ shares = $_______________ EPS
Price-to-Earnings (P/E) Ratio
Share price ÷ Annual Earnings Per Share = P/E
$_______________ ÷ $_______________ = _______________ P/E
Payout ratio
Dividends Per Share ÷ Earnings Per Share = Payout Ratio
$_______________ ÷ $_______________ = _______________% Payout Ratio
Net Margin
Net Profit ÷ Total Revenues = Net Margin
$_______________ ÷ $_______________ = _______________% Net Margin
Return On Equity (ROE)
Net Annual Profit ÷ Average Annual Shareholder Equity = Return On Equity
$_______________ ÷ $_______________ = _______________% ROE
Quick Ratio
(Current Assets - Inventories) ÷ Current Liabilities = Quick Ratio
($______________- $______________ ) ÷ $______________ = ______________ Quick Ratio
Debt Covering Ratio
Operating Income ÷ Current Liabilities = Debt Covering Ratio
$_______________ ÷ $_______________ = _______________ Debt Covering Ratio
Debt-to-Equity Ratio
Total Liabilities ÷ Shareholders’ Equity = Debt-to-Equity Ratio
$_______________ ÷ $_______________ = _______________% Debt-to-Equity Ratio
Free Cash Flow
Net Cash from Operating Activities - Capital Expenditures = Free Cash Flow
$_______________ - $_______________ = $_______________ Free Cash Flow
       Other How To's

No comments:

Post a Comment