Needle moving action has been spotted in Melbana Energy Ltd (MAY.AX) as shares are moving today on volatility 0.00% or $0.00 from the open. The ASX listed company saw a recent bid of $0.01 and 667167 shares have traded hands in the session.
There are various factors to examine when looking at what spurs growth in the stock market. Many investors will monitor macro-economic factors that influence the price of shares. Some of these factors include the overall condition of the economy and market sentiment. Following the macro factors, investors may employ a top down approach when viewing the equity markets. This may include starting with a sector poised for growth and filtering down to specific stock that meet the investor’s criteria. Another way to approach the stock market is to view the micro-economic factors that influence stocks. This may include studying company profits, news, and the competence of overall management. Investors will often try to piece together all the different information available in order to select stocks that will have a positive impact on the long-term strength of the portfolio.
Now let’s take a look at how the fundamentals are stacking up for Melbana Energy Ltd (MAY.AX). Fundamental analysis takes into consideration market, industry and stock conditions to help determine if the shares are correctly valued. Melbana Energy Ltd currently has a yearly EPS of -0.01. This number is derived from the total net income divided by shares outstanding. In other words, EPS reveals how profitable a company is on a share owner basis.
Turning to Return on Assets or ROA, Melbana Energy Ltd (MAY.AX) has a current ROA of -89.19. This is a profitability ratio that measures net income generated from total company assets during a given period. This ratio reveals how quick a company can turn it’s assets into profits. In other words, the ratio provides insight into the profitability of a firm’s assets. The ratio is calculated by dividing total net income by the average total assets. A higher ROA compared to peers in the same industry, would suggest that company management is able to effectively generate profits from their assets. Similar to the other ratios, a lower number might raise red flags about management’s ability when compared to other companies in a similar sector.
Another key indicator that can help investors determine if a stock might be a quality investment is the Return on Equity or ROE. Melbana Energy Ltd (MAY.AX) currently has Return on Equity of -93.25. ROE is a ratio that measures profits generated from the investments received from shareholders. In other words, the ratio reveals how effective the firm is at turning shareholder investment into company profits. A company with high ROE typically reflects well on management and how well a company is run at a high level. A firm with a lower ROE might encourage potential investors to dig further to see why profits aren’t being generated from shareholder money.
Another ratio we can look at is the Return on Invested Capital or more commonly referred to as ROIC. Melbana Energy Ltd (MAY.AX) has a current ROIC of -93.25. ROIC is calculated by dividing Net Income – Dividends by Total Capital Invested.
Similar to ROE, ROIC measures how effectively company management is using invested capital to generate company income. A high ROIC number typically reflects positively on company management while a low number typically reflects the opposite.