L Brands Retained Earnings vs. Book Value Per Share

Based on L Brands' profitability indicators, L Brands may not be well positioned to generate adequate gross income at the moment. It has a very high risk of underperforming in April. Profitability indicators assess L Brands' ability to earn profits and add value for shareholders.
For L Brands profitability analysis, we use financial ratios and fundamental drivers that measure the ability of L Brands to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well L Brands utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between L Brands's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of L Brands over time as well as its relative position and ranking within its peers.
  
Check out Correlation Analysis to better understand how to build diversified portfolios. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in bureau of labor statistics.
Please note, there is a significant difference between L Brands' value and its price as these two are different measures arrived at by different means. Investors typically determine if L Brands is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, L Brands' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

L Brands Book Value Per Share vs. Retained Earnings Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining L Brands's current stock value. Our valuation model uses many indicators to compare L Brands value to that of its competitors to determine the firm's financial worth.
L Brands is currently regarded as number one stock in retained earnings category among related companies. It is currently regarded as number one stock in book value per share category among related companies . . Comparative valuation analysis is a catch-all model that can be used if you cannot value L Brands by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for L Brands' Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the L Brands' earnings, one of the primary drivers of an investment's value.

L Brands Book Value Per Share vs. Retained Earnings

Retained Earnings is a balance sheet account that refers to the portion of company income that is retained by the firm. In other words, it is a part of earnings that is not paid out as dividends or otherwise distributed to owners. Retained Earnings are calculated by adding net income to last period retained earnings and subtracting any dividends paid to owners.

L Brands

Retained Earnings

 = 

Beginning RE + Income

-

Dividends

 = 
(1.03 B)
Retained Earnings shows how the firm utilizes its profits over time. In simple terms, investors can think of retained earnings as the amount of profit the company has reinvested in the business since its inceptions. However the methodology to make a decision over how much profit to retain is different between companies in different industries. For example, growing industries tend to retain more of their earnings than more matured industries as they need more assets investment to sustain their growth.
Book Value per Share (B/S) can be calculated by subtracting liabilities from assets, and then dividing it by the total number of currently outstanding shares. It indicates the level of safety associated with each common share after removing the effects of liabilities. In other words, a shareholder can use this ratio to see how much he or she can sell the stake in the company in the event of a liquidation.

L Brands

Book Value per Share

 = 

Common Equity

Average Shares

 = 
(2.38) X
The naive approach to look at Book Value per Share is to compare it to current stock price. If Book Value per Share is higher than the currently traded stock price, the company can be considered undervalued. However, investors must be aware that conventional calculation of Book Value does not include intangible assets such as goodwill, intellectual property, trademarks or brands and may not be an appropriate measure for many firms.

L Brands Book Value Per Share Comparison

L Brands is currently under evaluation in book value per share category among related companies.

L Brands Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in L Brands, profitability is also one of the essential criteria for including it into their portfolios because, without profit, L Brands will eventually generate negative long term returns. The profitability progress is the general direction of L Brands' change in net profit over the period of time. It can combine multiple indicators of L Brands, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
L Brands, Inc. operates as a retailer of home fragrance products, body care products, soaps and sanitizers, womens intimate and other apparel, and personal and beauty care products. L Brands, Inc. was founded in 1963 and is headquartered in Columbus, Ohio. L Brands operates under Apparel Retail classification in the United States and is traded on New York Stock Exchange. It employs 22400 people.

L Brands Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on L Brands. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of L Brands position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the L Brands' important profitability drivers and their relationship over time.

Use L Brands in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if L Brands position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in L Brands will appreciate offsetting losses from the drop in the long position's value.

L Brands Pair Trading

L Brands Pair Trading Analysis

The ability to find closely correlated positions to Electronic Arts could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Electronic Arts when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Electronic Arts - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Electronic Arts to buy it.
The correlation of Electronic Arts is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Electronic Arts moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Electronic Arts moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Electronic Arts can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your L Brands position

In addition to having L Brands in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Precious Metals Funds Thematic Idea Now

Precious Metals Funds
Precious Metals Funds Theme
Funds or Etfs that invest in entities that are involved in mining, processing or dealing of precious metals. The Precious Metals Funds theme has 33 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Precious Metals Funds Theme or any other thematic opportunities.
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Check out Correlation Analysis to better understand how to build diversified portfolios. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in bureau of labor statistics.
Note that the L Brands information on this page should be used as a complementary analysis to other L Brands' statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Content Syndication module to quickly integrate customizable finance content to your own investment portal.

Other Consideration for investing in L Brands Stock

If you are still planning to invest in L Brands check if it may still be traded through OTC markets such as Pink Sheets or OTC Bulletin Board. You may also purchase it directly from the company, but this is not always possible and may require contacting the company directly. Please note that delisted stocks are often considered to be more risky investments, as they are no longer subject to the same regulatory and reporting requirements as listed stocks. Therefore, it is essential to carefully research the L Brands' history and understand the potential risks before investing.
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