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SFM Assigmnt
SFM Assigmnt
ROCE : Dell ROCE can be seen as negative; as it suggests some competitors may be employing their
capital mpre efficiently. Its ROCE in absolute terms is poor. Considering the risk of owning stocks
compared to government bonds.
ROCE shud always be higher than the rate at which the company borrows otherwise any increase in
borrowing will reduc e shareholder’s earnings and vice versa. Good ROCE is one that is greater than the
rate at which the company borrows.
From the ROCE the investor are interested to see how efficeiently a company uses its capital employed s
well as its long term financing strategies. If answernya:$1.33. every dollar invested in employed capital,
scott earns $1.33
ROE; Negative means its shareholders are losing, rather than gaining value. This is usually a very bad sign
for investors and managers try to avoid a negative return as aggressively as possible. Most investors
avoid placing their money in a company that fails to consistently deliver positive returns, but investors
may overlook a negative returns for a single tough yr if the believe the company is well positions for long
term growth.
WACC:
Or in average :
PE ratio- 24.74
Price/sales 0.55
https://www.investopedia.com/articles/markets/110915/dell-stock-doesnt-exist-here-why.asp