Larsen Toubro Return On Equity vs. Revenue

LT Stock   3,608  21.40  0.59%   
Considering Larsen Toubro's profitability and operating efficiency indicators, Larsen Toubro Limited may not be well positioned to generate adequate gross income at the present time. It has a very high likelihood of underperforming in January. Profitability indicators assess Larsen Toubro's ability to earn profits and add value for shareholders.
For Larsen Toubro profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Larsen Toubro to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Larsen Toubro Limited utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Larsen Toubro's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Larsen Toubro Limited over time as well as its relative position and ranking within its peers.
  
Check out Correlation Analysis.
Please note, there is a significant difference between Larsen Toubro's value and its price as these two are different measures arrived at by different means. Investors typically determine if Larsen Toubro is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Larsen Toubro's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Larsen Toubro Limited Revenue vs. Return On Equity Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Larsen Toubro's current stock value. Our valuation model uses many indicators to compare Larsen Toubro value to that of its competitors to determine the firm's financial worth.
JavaScript chart by amCharts 3.21.15VHLPILANIINVSSUMMITSECKICLNSILNBIFINLT 0500B1T1.5T2T2.5T -0.0500.050.100.150.20
Larsen Toubro Limited is currently regarded as number one stock in return on equity category among its peers. It also is considered the number one company in revenue category among its peers totaling about  Huge  of Revenue per Return On Equity. At present, Larsen Toubro's Total Revenue is projected to increase significantly based on the last few years of reporting. 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 Larsen Toubro's earnings, one of the primary drivers of an investment's value.

Larsen Revenue vs. Return On Equity

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.

Larsen Toubro

Return On Equity

 = 

Net Income

Total Equity

 = 
0.16
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.
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.

Larsen Toubro

Revenue

 = 

Money Received

-

Discounts and Returns

 = 
2.19 T
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Larsen Revenue vs Competition

Larsen Toubro Limited is considered the number one company in revenue category among its peers. Market size based on revenue of Industrials industry is now estimated at about 2.45 Trillion. Larsen Toubro totals roughly 2.19 Trillion in revenue claiming about 89% of equities under Industrials industry.
JavaScript chart by amCharts 3.21.15OthersKICLNSILSUMMITSECPILANIINVSLT

Larsen Toubro Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Larsen Toubro, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Larsen Toubro will eventually generate negative long term returns. The profitability progress is the general direction of Larsen Toubro's change in net profit over the period of time. It can combine multiple indicators of Larsen Toubro, 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.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income65.4 B68.7 B
Operating Income234.2 B245.9 B
Income Before Tax204.9 B215.1 B
Total Other Income Expense Net-29.3 B-27.8 B
Net Income130.6 B86.3 B
Income Tax Expense49.5 B51.9 B
Net Income From Continuing Ops155.5 B96.8 B
Net Income Applicable To Common Shares13.5 B12.8 B
Interest Income24.5 B13.2 B
Net Interest Income-35.5 B-37.2 B
Change To Netincome40.7 B42.8 B

Larsen Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Larsen Toubro. 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 Larsen Toubro 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 Larsen Toubro's important profitability drivers and their relationship over time.

Use Larsen Toubro 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 Larsen Toubro 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 Larsen Toubro will appreciate offsetting losses from the drop in the long position's value.

Larsen Toubro Pair Trading

Larsen Toubro Limited Pair Trading Analysis

The ability to find closely correlated positions to Larsen Toubro could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Larsen Toubro 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 Larsen Toubro - 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 Larsen Toubro Limited to buy it.
The correlation of Larsen Toubro 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 Larsen Toubro moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Larsen Toubro Limited 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 Larsen Toubro 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.
Pair CorrelationCorrelation Matching

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Other Information on Investing in Larsen Stock

To fully project Larsen Toubro's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Larsen Toubro Limited 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 Larsen Toubro's income statement, its balance sheet, and the statement of cash flows.
Potential Larsen Toubro investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Larsen Toubro investors may work on each financial statement separately, they are all related. The changes in Larsen Toubro's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Larsen Toubro's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.

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