Book Value / EPS ratio :

Book Value / EPS ratio :

It may suggest Doubling time of stock: that means number of years is required to double it’s share price.
BE has 60-70% sensitivity.
If book value is less than current market price of a share in current scenario of bull market :
It means a Dying company. Avoid it.

PEG / PB/ PE ratio

LESSONS LEARNT:

  1. Lesser PEG is better
  2. Institutions and Smart Players use PE, PEG ratio to Entry and Exit from stocks
  3. Price to Book ratio is the value we pay for present Networth of company.
  4. PE, PB and PEG are valuation ratio which are used for Entry and Exit
  5. Book value= Networth / No of shares
    Networth = Share Capital + Reserve
  6. When Nifty PE 28: sell
    <20: buy (Beg, borrow or steal to buy: Do not take it literally)
  7. Absolute values of PE, PB and PEG doesn’t tell anything. We must compare it with either same company or Industry. The best method is to compare with same company.