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Average price-earnings multiple on main board up in April

2012/05/04 20:24:16

Taipei, May 4 (CNA) The average price to earnings multiple (PE ratio) on the Taiwan Stock Exchange at the end of April was 22.72, up from 20.68 recorded at the end of March, the local bourse said Friday.

The PE ratio is the company's share price divided by its earnings per share. The higher the PE multiple, the more expensive the stock.

The TWSE said the average PE ratio on the market at the end of April was 24.67 when financial stocks were excluded and 20.67 when electronics shares were not included.

When both the financial and electronics sectors were excluded, the average PE multiple was 24.12.

Utilities had the highest PE multiple of all sectors on the main board at the end of April at 76.3, while the construction and building material sector had the lowest at 10.04, the exchange said.

The average dividend yield ratio at the end of April rose to 4.26 percent, up from 4.13 percent at the end of March, while the average price to book value per share multiple (PB ratio) fell to 1.58 from 1.69, the TWSE said.

The dividend yield is a calculation which compares a listed company's dividend payout and its share price, and serves as a measure of how much cash an investor can get for each Taiwan dollar invested in a stock.

The PB ratio is also a concept which indicates the valuation of a stock. It is calculated by dividing a stock's price by its book value.

According to the exchange, a total of 794 companies were listed on the main board in April.

(By Tien Yu-pin and Frances Huang)