COMPARATIVE Q3 2017 ANALYSIS BETWEEN GTBANK AND ZENITH BANK

ROE (Return on Equity): this is used to measure management performance, it indicates how well a company uses the capital from shareholders to generate profit. The higher the ratio, the better and suggest higher level of management performance.

ROA (Return on assets): it indicates the percentage of profit that a company earns in relation to its overall total assets.it measures the amount of profit made by a company per Naira of its assets, the higher the ratio, the better

 DAR (Debt to Asset Ratio): it shows the relationship between company’s liabilities and its assets. It indicates the proportion of assets that is financed by debt, the lower the ratio, the better.

EV/EBITDA (Enterprise Value to Earnings Before Interest, Tax, Depreciation and Amortisation): it estimates the number of years in which the company will repay its acquisition cost to the buyer through its earnings.

DE (Debt to Equity ratio): it provides an indication of a company’s finance structure and whether the company is more reliant on borrowing (debt) or shareholders capital to fund business operation, the higher the ratio, the riskier the company.

BVS (Book value per share): it is the difference between company’s asset and its liability.  it is a determinant of the value of a company equity relative to the market value.

PE (Price to Earnings): it indicates how much an investor pays for every one Naira the company earns. It can also be said to be the numbers of years it will take to recoup ones investment in the company.

EPS (Earnings per share): It indicates how much each share you own has earned.

FAIR VALUE: this is the value of the company relative to the return on FGN Savings Bond.

MARKET CAPITALIZATION: this is the market value of a company’s stock. It is derived by multiplying the number of share outstanding by the current share price. It helps investors to determine the cost of buying the entire shares of a company.it is the theoretical cost of buying a company.

ENTERPRISE VALUE: this is the actual cost of buying a company as it calculates the accurate value of a company take over price by factoring the debt in the company’s books.