By: Gerald Bryan · May 2, 2024
ggplot
and gganimate
to craft stunning animated visualizations. These plots aren’t just eye candy; they’re the content that keeps Sectors Instagram account buzzing (make sure to check them out and hit that follow button!). Each plot is based on meticulously curated data from the Sectors team, providing insightful analysis, particularly focusing on the Indonesia Stock Exchange. So, without further ado, let’s dive into the excitement of our third recipe in this animation plot series!
Price to Earning Ratio
(PE Value) and Price to Book Value Ratio
(PBV).
Example: A P/E ratio of 15 means that the company’s current market value equals 15 times its annual earnings.The P/E ratio serves as a valuable tool for investors to gauge whether a stock is undervalued or overvalues. A high P/E ratio may indicate that the stock is overvalued, suggesting either optimistic growth expectations or inflated market sentiment and vice versa. Additionally, by calculating the median P/E ratio across several years, investors can establish a standardized benchmark to determine a stock’s potential worth. However, a notable limitation of using P/E ratios arises when comparing companies across different sectors. Variations in valuation and growth rates are common among industries due to differences in revenue generation timing and business models, making direct P/E ratio comparisons less reliable.
Example A P/B ratio of 1 means that the stock price is trading in line with the book value of the company. In other words, the stock price would be considered fairly valued, strictly from a P/B standpoint.Typically, a P/B ratio below one suggests that a company is undervalued, whereas a ratio above one suggests that the stock is trading at a premium. However, the significance of these values can vary significantly across industries. Different sectors have their own norms, where lower or higher P/B ratios may be considered typical. However, the P/B ratio has its limitations. For instance, it does not take into account intangible assets such as intellectual property and brand value, which can be significant in certain industries. As a result, the P/B ratio may not always accurately reflect a company’s true value. Furthermore, the P/B ratio may be less relevant for companies with a high proportion of intangible assets, such as technology firms, where the value lies more in ideas and innovations than in physical assets.
stocks
list. Finally, here is the result of the fetching code.
symbol | year | pe | pb | pe_peer_avg | pb_peer_avg |
---|---|---|---|---|---|
BBCA.JK | 2020 | 30.45000 | 4.4800000 | 27.29648 | 1.2624248 |
BBCA.JK | 2021 | 28.35000 | 4.3900000 | 15.01456 | 1.4663059 |
BBNI.JK | 2022 | 9.30000 | 1.2500000 | 15.12926 | 1.0085239 |
BBNI.JK | 2023 | 9.30000 | 1.3000000 | 13.15047 | 0.7844267 |
BBRI.JK | 2020 | 27.30000 | 2.2400000 | 27.29648 | 1.2624248 |
pe_peer_avg
and pb_peer_avg
columns which are the Sectors PE ratio and PBV ratio in each year and every symbol will have the same value if the year is the same. Therefore, we will convert those value and bind it into our data using the code below.
symbol | year | pe | pb |
---|---|---|---|
Banks Sub-Sector | 2020 | 27.29648 | 1.2624248 |
BBCA.JK | 2020 | 30.45000 | 4.4800000 |
BBCA.JK | 2021 | 28.35000 | 4.3900000 |
BBNI.JK | 2022 | 9.30000 | 1.2500000 |
BBNI.JK | 2023 | 9.30000 | 1.3000000 |
BBRI.JK | 2020 | 27.30000 | 2.2400000 |
BBCA.JK
from year 2020 to 2023 using the code below.
.gif
file.