Evaluate the shares of companies listed on Stock Exchange
(free of charge)
Clarification required
Regarding intellectual property rights:
(Property rights are considered a repository of historical records of events that took place within the company.)
Shareholders' equity increases by adding various reserves and retained earnings to capital in previous years.
Equity decreases when there are no retained earnings but rather losses that have reduced the capital itself.
An increase in shareholders' equity can strengthen a company's financial position. However, it may also indicate a slowdown in dividend payouts to shareholders, especially if the increase in equity is very large.
Regarding the market share price and book value:
Book value is the value that a shareholder is entitled to upon liquidation of the company (especially if the company's balance sheet figures reflect its true reality).
The likelihood of loss increases when the market price of the stock is higher than the book value (especially when there is a large difference between them and then the market price of the stock falls towards the book value).
However, if the book value is higher than the market share price displayed on the price screen at the time of purchase, this is very good, provided that there are no losses in the company's capital value and that the company is making profits.
Regarding the company's efficiency:
There are several competencies that any company in the world can achieve, and the levels of company efficiency are (Excellent - Very Good - Good - Acceptable - Weak - Losses)
Efficiency refers to the ability of a company's management to utilize its available resources (whether from its own funds, credit facilities, or external credit facilities) to generate profits commensurate with those resources.
In addition to the efficiency of the company's management, this efficiency must be reflected in the ratio of earnings per share to its book value, not its nominal value, for two reasons. :.
First reason:
There is a surplus of reserves and retained earnings that should be rewarded with further profit generation.
The second reason:
This means that the buyer of the share will purchase it based on its book value, not its nominal value, in order to protect the rights of the founders of this company.