Heineken Current Valuation vs. Return On Equity

HINKF Stock  USD 72.43  0.73  1.02%   
Considering Heineken's profitability and operating efficiency indicators, Heineken NV may not be well positioned to generate adequate gross income at the moment. It has a very high risk of underperforming in January. Profitability indicators assess Heineken's ability to earn profits and add value for shareholders.
For Heineken profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Heineken to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Heineken NV utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Heineken's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Heineken NV over time as well as its relative position and ranking within its peers.
  
Check out Risk vs Return Analysis.
Please note, there is a significant difference between Heineken's value and its price as these two are different measures arrived at by different means. Investors typically determine if Heineken is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Heineken'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.

Heineken NV Return On Equity vs. Current Valuation Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Heineken's current stock value. Our valuation model uses many indicators to compare Heineken value to that of its competitors to determine the firm's financial worth.
Heineken NV is rated as one of the top companies in current valuation category among its peers. It also is one of the top stocks in return on equity category among its peers . The ratio of Current Valuation to Return On Equity for Heineken NV is about  334,561,887,153 . 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 Heineken's earnings, one of the primary drivers of an investment's value.

Heineken Current Valuation vs. Competition

Heineken NV is rated as one of the top companies in current valuation category among its peers. After adjusting for long-term liabilities, total market size of Beverages—Brewers industry is currently estimated at about 687.3 Billion. Heineken retains roughly 68.99 Billion in current valuation claiming about 10% of stocks in Beverages—Brewers industry.

Heineken Return On Equity vs. Current Valuation

Enterprise Value is a firm valuation proxy that approximates the current market value of a company. It is typically used to determine the takeover or merger price of a firm. Unlike Market Cap, this measure takes into account the entire liquid asset, outstanding debt, and exotic equity instruments that the company has on its balance sheet. When a takeover occurs, the parent company will have to assume the target company's liabilities but will take possession of all cash and cash equivalents.

Heineken

Enterprise Value

 = 

Market Cap + Debt

-

Cash

 = 
68.99 B
Enterprise Value can be a useful tool to compare companies with different capital structures. Long term liability and current cash or cash equivalents can have a huge impact on market valuation of a given company.
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.

Heineken

Return On Equity

 = 

Net Income

Total Equity

 = 
0.21
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.

Heineken Return On Equity Comparison

Heineken is currently under evaluation in return on equity category among its peers.

Heineken Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Heineken, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Heineken will eventually generate negative long term returns. The profitability progress is the general direction of Heineken's change in net profit over the period of time. It can combine multiple indicators of Heineken, 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.
Heineken N.V. engages in the brewing and selling of beer and cider. The company was founded in 1864 and is based in Amsterdam, the Netherlands. HEINEKEN is traded on OTC Exchange in the United States.

Heineken Profitability Driver Comparison

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

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

Heineken Pair Trading

Heineken NV Pair Trading Analysis

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

Use Investing Themes to Complement your Heineken position

In addition to having Heineken 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?

Run Israel Wall Street Thematic Idea Now

Israel Wall Street
Israel Wall Street Theme
Cross-sector collection of best publicly traded Israel entities that are expected to continue growing. The Israel Wall Street theme has 71 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Israel Wall Street Theme or any other thematic opportunities.
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Other Information on Investing in Heineken OTC Stock

To fully project Heineken's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Heineken NV 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 Heineken's income statement, its balance sheet, and the statement of cash flows.
Potential Heineken investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Heineken investors may work on each financial statement separately, they are all related. The changes in Heineken's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Heineken'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.