JBH share price in focus
Established in 1974, JB Hi-Fi is one of Australia’s largest retailers of electronic and home entertainment products.
The company is broadly split into three business segments, namely JB Hi-Fi Australia, JB Hi-Fi New Zealand and The Good Guys, which sells a similar range of products and was acquired in 2016.
JB Hi-Fi operates through a cost-leadership strategy meaning it competes on price against its competitors. Many of its products are often discounted resulting in much better perceived value for its customers.
AMC shares
Amcor designs and manufactures a wide variety of packaging solutions, including flexible packaging, rigid containers, specialty cartons, and closures.
With origins dating back to the 1860s, Amcor has grown into a global leader, operating across more than 200 sites in 40 countries.
JBH share price valuation
As a growth company, one way to put a rough guesstimate on the JBH share price could be to compare its price-to-sales multiple over time. This can tell us how the company has historically been valued relative to its total revenue.
Currently, JB Hi-Fi Ltd shares have a price-sales ratio of 1.09x, compared to its 5-year average of 0.70x, meaning its shares are trading above their historical average. This could mean that the share price has increased, or that sales have declined, or both. In the case of JBH, revenue has been growing over the last 3 years. Of course, context is important – and this is just one valuation technique. Investment decisions can’t just be based on one metric, but this can be a rough starting point.
Since it is a more of a ‘blue chip’ company, we could look at the dividend yield of AMC to determine its value. If we compare it to the historical dividend yield, we can get a sense of the stability of the company and its ability to pay out income. AMC is offering a trailing dividend yield of around 4.95%, which compares to its 5-year average of 4.38%. Of course, this is just one of many ways you could put a value on AMC shares. The Rask websites offer free online investing courses, created by analysts explaining valuation methods like Discounted Cash Flow (DCF) and Dividend Discount Models (DDM). They even include free valuation spreadsheets! It’s important to look at multiple methods when you’re trying to value the AMC share price.
