COH share price in focus
Cochlear is a medical device company founded in 1981 in Sydney. It designs, manufactures and distributes three different hearing implants for different medical situations.
Cochlear is a global leader in hearing devices and has provided over 750,000 implantable devices. It has over 5,000 employees throughout more than 50 countries.
Cochlear’s mission is to improve its customers’ quality of life who suffer from hearing-related conditions.
JBH shares
Founded in 1974, JB Hi-Fi is among Australia’s leading retailers of electronics and home entertainment products.
The company operates across three main segments: JB Hi-Fi Australia, JB Hi-Fi New Zealand, and The Good Guys, the latter acquired in 2016 and offering a similar product range.
JB Hi-Fi follows a cost-leadership strategy, focusing on competitive pricing to stand out against its rivals. Frequent discounts on its products enhance their perceived value, providing customers with attractive deals.
COH & JBH share price valuation
As a growth company, one way to put a broad estimate on the COH 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, Cochlear Ltd shares have a price-sales ratio of 7.95x, compared to its 5-year average of 9.18x, meaning its shares are trading lower than their historical average. This could mean that the share price has fallen, or sales have increased, or both. In the case of COH, 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.
The JBH share price currently trades at a price-sales ratio of 1.17x, which compares to its 5-year long-term average of 0.70x. So, its shares are trading above their historical average. Don’t forget, a simple multiple like this should only be the start of your research. 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! It’s a good idea to use multiple valuation methods to value a share like JB Hi-Fi Ltd.
