Market Value Research Department, Financial Engineering Research Center, Central China Normal University
When the dust settles on the closing price on April 30, 2024, the market value formed by the stock price will also be obvious.
Market capitalization refers to the abbreviation of market value, which is the market price of the total share capital formed by the stock price, that is, the total price value of the listed company given by the capital market. Market capitalization measures the performance and strength of listed companies, and measures the interests and wealth of investors. Therefore, the market value has also become the core index for evaluating listed companies; However, the evaluation is the total amount, which cannot reflect the quality of the market value. First of all, the size of the market capitalization does not reflect the growth of the market capitalization, and it cannot answer whether the market capitalization is increasing or decreasing compared with the market value of the previous period. Secondly, the size of the market capitalization does not reflect the appreciation of the market value, and cannot answer the question of whether it is an increase or a decrease compared with the existing book value of the equity. Third, the size of the market capitalization does not reflect the correlation with the intrinsic value, and cannot answer the question of whether the market value is consistent with or contradictory to the intrinsic value.
Therefore, the market value is reflected in quantity, which is mainly reflected in the market value scale and market value growth; There are also qualitative provisions, which are mainly reflected in the value-added nature of equity and the consistency of internal value. The market value should not only be judged by the size of the scale, but should be the evaluation of the quality of the market value, that is, the evaluation from the aspects of market value scale, market value growth, equity appreciation, and internal value matching, so as to help enterprise operators establish the goal of optimizing market value and create a good market value; In order to help investors find a good market value according to their own preferences.
At the end of April 2024, what is the market value quality of the A-share LED industry?
To this end, we have monitored and evaluated the market value quality of 42 listed companies with effective data in the LED industry according to the closing price of 2024.04.30 and the recently released annual and quarterly report data, and the results are as follows:
1. Is the market value large?
The size of the market cap reflects the size of the market capitalization. According to the formula of market value = closing price of A shares x total shares, the market value of the listed company is calculated.
On April 30, 2024, the average market capitalization of listed companies in this industry was 6.261 billion yuan (total market capitalization of 262.966 billion yuan).
According to the five levels of ABCDE, which is very large to very small, it is divided into "D", that is, in the market capitalization scale.
The order is as follows:
Generally speaking, the larger the market capitalization, the better. The larger the market capitalization, the larger the company's capital scale, the greater the impact on the society, the better the financing and intellectual conditions for the development of the enterprise, the greater the stability of the development, and the smaller the risk of change; However, it is necessary to further analyze the growth, appreciation and intrinsic value consistency of market capitalization in order to better judge the favorability of market capitalization.
2. How much has the market value increased?
Market capitalization growth refers to the extent to which the total market capitalization of the current period has expanded compared with the total market capitalization of the previous period. The market value growth of the listed company is calculated according to the formula of the month-on-month growth of market value = total market value of the current period - total market value of the previous period.
As of April 30, 2024, the average month-on-month increase in the market value of listed companies in this industry was -1.228 billion yuan (total growth of -51.578 billion yuan), with an average growth rate of -25.87%.
The five levels of ABCDE, which grow a lot to negatively, are divided into "E", that is, negative market capitalization.
The order is as follows:
Generally speaking, the more the increase, the better, the more, indicating the greater the scale of the market capitalization growth; The smaller the size, the smaller the market cap growth. However, it is necessary to further analyze the value-added and intrinsic value of the market value, so as to judge the profitability and stability of the market value growth.
3. Is there a lot of market value appreciation?
Market appreciation refers to the value added of the market compared to the equity of shareholders. According to the formula of market appreciation = market value - shareholders' equity, the market appreciation of listed companies is calculated.
On April 30, 2024, the average market value added of listed companies in this industry was 2.657 billion yuan (total 111.594 billion yuan).
According to the five levels of ABCDE, which has a lot of appreciation to a lot of impairment, it is divided into "C", that is, the market value has increased more.
The order is as follows:
Generally speaking, the more value added to the market, the better. Shareholders' equity is the book value of stock, and market appreciation is the value of incremental income. This indicator is positive, indicating the appreciation of shareholders' equity, and negative, indicating the impairment of shareholders' equity. However, it is still necessary to further analyze the consistency between market value and intrinsic value, and judge the stability and sustainability of equity appreciation, so as to more effectively judge the long-term effect of equity appreciation.
Fourth, is the market value consistent?
Market capitalization alignment refers to the degree to which market capitalization matches intrinsic value. The intrinsic value is estimated by the economic value-added improvement model, that is, value = equity book value + current performance continuation value + future performance growth value. Market capitalization ratio = (equity book value + current performance continuation value + future performance growth value) / market capitalization.
As at 30 April 2024, the average coefficient of convergence between market capitalization and internal value of listed companies in this sector was 0.95.
According to the five grades of ABCDE, which are very consistent to very inconsistent, they are divided into "B-" (+ is undervalued, - is overvalued), that is, the market value is slightly overestimated and slightly inconsistent.
The order is as follows:
If the market value matching ratio is equal to 1, it means that the market value reasonably reflects the intrinsic value; If it is greater than 1, it means that the market value underestimates the intrinsic value; If it is below 1, the market capitalization is overestimating the intrinsic value.
The specific measurement method of the market value coherence rate is as follows: taking the assumption that the market value and the internal value are equal to 1, the book value support rate of the market value of the industry is 53.25%, the support rate of the current performance continuation value is 2.42%, and the support rate of the future performance growth value is 44.33%; According to the risk and probability, the risk coefficient of the book value of equity is calculated to be -0.05, which is unreasonable, the risk coefficient of the current performance value is 0, which is reasonable, and the probability coefficient of future growth value is 0, which is the realization coefficient of 0.2 of the required compound growth rate of 12.41% + the correction coefficient of the realized compound growth rate of net profit in the past three years of -1.25% and -0.2, and uncertain. The sum of the above three forms a reasonable coefficient of intrinsic value of -0.05. Intrinsic value rationality coefficient -0.05 + hypothetical value market value parity rate 1 = market value coincidence rate 0.95.
On April 30, 2024, the market value quality characteristics of listed companies in this industry are "DECB-", that is, in the market value scale, the market value has a negative growth, the market value has increased more, and the market value is slightly overestimated and slightly inconsistent.
(This article is calculated based on publicly available data and does not constitute investment advice and is for reference only)