Wesfarmers Return On Asset vs. Return On Equity
| WFAFFDelisted Stock | USD 46.45 0.00 0.00% |
For Wesfarmers profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Wesfarmers to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Wesfarmers Limited utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Wesfarmers's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Wesfarmers Limited over time as well as its relative position and ranking within its peers.
Wesfarmers |
Wesfarmers Limited Return On Equity vs. Return On Asset Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Wesfarmers's current stock value. Our valuation model uses many indicators to compare Wesfarmers value to that of its competitors to determine the firm's financial worth. Wesfarmers Limited is rated first in return on asset category among its peers. It is rated first in return on equity category among its peers reporting about 3.43 of Return On Equity per Return On Asset. 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 Wesfarmers' earnings, one of the primary drivers of an investment's value.Wesfarmers Return On Equity vs. Return On Asset
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Wesfarmers |
| = | 0.0775 |
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.
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.
Wesfarmers |
| = | 0.27 |
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.
Wesfarmers Return On Equity Comparison
Wesfarmers is currently under evaluation in return on equity category among its peers.
Wesfarmers Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Wesfarmers, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Wesfarmers will eventually generate negative long term returns. The profitability progress is the general direction of Wesfarmers' change in net profit over the period of time. It can combine multiple indicators of Wesfarmers, 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.
Wesfarmers Limited engages in the retail business in Australia, New Zealand, the United Kingdom, and internationally. Wesfarmers Limited was founded in 1914 and is headquartered in Perth, Australia. Wesfarmers operates under Home Improvement Retail classification in the United States and is traded on OTC Exchange. It employs 120000 people.
Wesfarmers Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Wesfarmers. 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 Wesfarmers 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 Wesfarmers' important profitability drivers and their relationship over time.
Use Wesfarmers 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 Wesfarmers 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 Wesfarmers will appreciate offsetting losses from the drop in the long position's value.Wesfarmers Pair Trading
Wesfarmers Limited Pair Trading Analysis
The ability to find closely correlated positions to Wesfarmers could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Wesfarmers 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 Wesfarmers - 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 Wesfarmers Limited to buy it.
The correlation of Wesfarmers 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 Wesfarmers moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Wesfarmers 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 Wesfarmers 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 Wesfarmers position
In addition to having Wesfarmers 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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ETF themes focus on helping investors to gain exposure to a broad range of assets, diversify, and lower overall costs. The High Dividend Yield ETFs theme has 107 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 High Dividend Yield ETFs Theme or any other thematic opportunities.
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Check out Your Current Watchlist to better understand how to build diversified portfolios. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in census. You can also try the Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Consideration for investing in Wesfarmers Pink Sheet
If you are still planning to invest in Wesfarmers Limited check if it may still be traded through OTC markets such as Pink Sheets or OTC Bulletin Board. You may also purchase it directly from the company, but this is not always possible and may require contacting the company directly. Please note that delisted stocks are often considered to be more risky investments, as they are no longer subject to the same regulatory and reporting requirements as listed stocks. Therefore, it is essential to carefully research the Wesfarmers' history and understand the potential risks before investing.
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