Restaurant Brands Price To Earning vs. Return On Equity
| 0R6 Stock | EUR 62.82 0.04 0.06% |
For Restaurant Brands profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Restaurant Brands to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Restaurant Brands International utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Restaurant Brands's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Restaurant Brands International over time as well as its relative position and ranking within its peers.
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Restaurant Brands Return On Equity vs. Price To Earning Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Restaurant Brands's current stock value. Our valuation model uses many indicators to compare Restaurant Brands value to that of its competitors to determine the firm's financial worth. Restaurant Brands International is rated fifth in price to earning category among its peers. It is rated third in return on equity category among its peers reporting about 0.01 of Return On Equity per Price To Earning. The ratio of Price To Earning to Return On Equity for Restaurant Brands International is roughly 77.07 . The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Restaurant Brands' earnings, one of the primary drivers of an investment's value.Restaurant Return On Equity vs. Price To Earning
Price to Earnings ratio is typically used for current valuation of a company and is one of the most popular ratios that investors monitor daily. Holding a low PE stock is less risky because when a company's profitability falls, it is likely that earnings will also go down as well. In other words, if you start from a lower position, your downside risk is limited. There are also some investors who believe that low Price to Earnings ratio reflects the low pricing because a given company is in trouble. On the other hand, a higher PE ratio means that investors are paying more for each unit of profit.
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| = | 28.13 X |
Generally speaking, the Price to Earnings ratio gives investors an idea of what the market is willing to pay for the company's current earnings.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
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| = | 0.37 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Restaurant Return On Equity Comparison
Restaurant Brands is rated second in return on equity category among its peers.
Restaurant Brands Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Restaurant Brands, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Restaurant Brands will eventually generate negative long term returns. The profitability progress is the general direction of Restaurant Brands' change in net profit over the period of time. It can combine multiple indicators of Restaurant Brands, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Restaurant Brands International Inc. owns, operates, and franchises quick service restaurants under the Tim Hortons , Burger King , and Popeyes brand names. Restaurant Brands International Inc. was founded in 1954 and is headquartered in Toronto, Canada. RESTAURANT BRANDS operates under Restaurants classification in Germany and is traded on Frankfurt Stock Exchange. It employs 6000 people.
Restaurant Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Restaurant Brands. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Restaurant Brands position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Restaurant Brands' important profitability drivers and their relationship over time.
Use Restaurant Brands in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Restaurant Brands position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Restaurant Brands will appreciate offsetting losses from the drop in the long position's value.Restaurant Brands Pair Trading
Restaurant Brands International Pair Trading Analysis
The ability to find closely correlated positions to Restaurant Brands could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Restaurant Brands when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Restaurant Brands - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Restaurant Brands International to buy it.
The correlation of Restaurant Brands is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Restaurant Brands moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Restaurant Brands moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Restaurant Brands can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Restaurant Brands position
In addition to having Restaurant Brands in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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Additional Information and Resources on Investing in Restaurant Stock
When determining whether Restaurant Brands is a strong investment it is important to analyze Restaurant Brands' competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Restaurant Brands' future performance. For an informed investment choice regarding Restaurant Stock, refer to the following important reports:Check out Trending Equities. You can also try the Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
To fully project Restaurant Brands' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Restaurant Brands at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Restaurant Brands' income statement, its balance sheet, and the statement of cash flows.