Is Associated British Foods expensive at 2,376p?
Associated British Foods (LON:ABF) is a £18.7bn ingredients and retail company, with operating segments including grocery, sugar, agriculture, ingredients and retail.
Right now the Associated British Foods share price is on the expensive side, in our view, based on its Value Rank of 35. Let's see why this is.
A closer look at Associated British Foods's Value Rank
We can see by using Associated British Foods’s StockReport that the group has a:
- Rolling price to book value of 2.07,
- Trailing twelve month price to earnings ratio of 18.6
- Trailing twelve month price to free cashflow of 27.4
- Rolling dividend yield of 1.96%
- Trailing twelve-month price to sales ratio of 1.20
This combination of financial traits suggests that Associated British Foods stock is toward the more expensive end of the market. Being expensive is not the end of the world, of course - but it does help to have favourable exposures to other factors to justify the share price premium.
What does this mean for potential investors?
Some of the best quality stocks in the market have defensible models that can deliver high levels of shareholder returns over the long term. But there are no guarantees and it's important to do your own research. Indeed, we've identified some areas of concern with Associated British Foods that you can find out about here.
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