The number of shares multiplied by the share price calculates market capitalization. Investor ratio can determine how well the company is doing in relation to the shares. Price earnings ratio is the most important investor ratio, which is the share price divided by the earnings per share. It measures the growth of the company relation to its earning. A higher price to earnings ratio means a higher true earning is expected for the company or the stock is overpriced. Liabilities. Financial stability is measured by Liquidity ratio.
Working capital is Current assets – Current liabilities. Working capital tells us the company’s efficiency and its short-term financial health. As given in the appendices the working capital of Port of Tarring has increased from 2996 in 2009 to 10981 in 2010, which shows that Port of Tarring liability to pay is lesser than its assets. The current liquidity ratio is current assets divided by current liabilities and it mostly measures the liquidity of he firm. The current ratio of Port of Tarring for 2011 and 2010 was 1.
36:1 and 1. 13:1 respectively.
The higher current ratio means ability to pay its liabilities off in time without any problem. In the case of Port of Tarring, it has increased its Current ratio but remains satisfactory. See Appendices 7 Financial structure ratio determines the ability of a firm to meet its long-term liability and the proportion of funds supplied by the owners. It is measured by gearing ratio, which is calculated by non-current liabilities divided by the non-current liabilities plus equity times 100. In 2010 the ratio for POT was 28.
42% and in 2011 it went down to 27. 19%. It means that POT is not depending much on outsider investments.
See Appendices 8 See Appendices 5 The pie chart shows the distribution of assets and liabilities. It is of high significance for a company to be able to pay off their long term and short-term debts. As shown in the Pie chart there is more short term Liabilities than assets, which means Port of Tarring, remains satisfactory in keeping up with its short term debts. Port of Tarring long-term assets exceed its liabilities by a vast gap of 53%. Port of Tarring has invested more in its long-term assets, which is more profitable because long-term assets generate more profit than short term.
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