The ASX Ltd (ASX:ASX) share price has risen 1.0% since the start of 2024. The Qantas Airways Limited (ASX:QAN) share price is about 65.1% off its 52-week low.
ASX share price in focus
ASX Limited operates Australia’s primary national securities exchange. This includes the provision of securities exchange services, derivatives exchange services, central counterparty clearing services, and registry, settlement, and delivery-versus-payment clearing financial products.
The company provides access to a variety of different products, including shares, futures, exchange traded funds (ETFs), managed funds, and real estate investment trusts (REITs).
ASX operates at the heart of the Australian financial markets. It oversees compliance for listed companies and aims to promote a high standard of corporate governance and a fairer playing field for retail investors.
QAN shares
Qantas was founded in 1921 and is Australia’s largest airline operator by fleet size, number of international flights, and number of destinations.
It’s involved in the operation of domestic and international flights, freight services and the management of its frequent flyer loyalty program.
Qantas also owns Jetstar meaning they have significant pricing and market power in the highly concentrated Australian market.
ASX share price valuation
As a growth company, one way to put a broad projection on the ASX share price could be to compare its price-to-sales multiple over time. Currently, ASX Ltd shares have a price-sales ratio of 7.87x, compared to its 5-year average of 8.12x, meaning its shares are trading below their historical average. This could mean that the share price has fallen, or sales have increased, or both. In the case of ASX, revenue has been growing over the last 3 years. Please keep in mind that context is important – and this is just one valuation technique. Investment decisions can’t just be based on one metric.
Since it is a more of a ‘blue chip’ company, we could look at the dividend yield of QAN to determine its value. QAN is offering a trailing dividend yield of around 0.00%, which compares to its 5-year average of 1.22%.The Rask websites offer free online investing courses, created by analysts explaining things like Discounted Cash Flow (DCF) and Dividend Discount Models (DDM). They even include free valuation spreadsheets. Both of these models would be a better way to value the QAN share price.”)
