The Razor's Edge

2-Year Price History

Ockham's Rating

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YPF Revenue

For a long time, value investors have used the current share price relative to sales per share levels as an important valuation tool. We utilize a historical weighted average methodology that treats recent years more importantly in the calculation. When looking at YPF through this framework, we can see that our weighted average historical high and low Price to Sales per share ratios over the last 10 years are 2.33x and 1.47x respectively.

Utilizing this range we can see that YPF’s current Price to Sales per share ratio of 1.81x is somewhat below its historical weighted average by 5%. Given this level of sales per share, we suggest a neutral share price forecast. To the extent there is a further drop in the Price to Sales ratio from current levels, which would occur through some combination of increased sales per share or a decline in share price, we would only become more positive about the Price to Sales ratio outlook.

YPF Cash Earnings

Cash Earnings is always one of the most important factors to review for a company and, more importantly, an investment in a stock. YPF is above its historical average multiple of cash earnings as calculated by Ockham. Similar to our analysis of sales per share, Ockham looks at the last 10 years of cash earnings levels for YPF to identify where the current high and low price levels have been historically in relation to profit per share. Again, we utilize a weighted average methodology which relies more heavily on recent years of data. This weighted average framework provides us with an average high Price to Cash Earnings ratio per share of 7.66 and a 4.83 low over the same period.

Given this range of ratios per share, YPF at its current price of $47.83 and a Price to Cash Earnings ratio of 6.97 is 11% above its average historical Price to Cash Earnings ratio. Obviously this makes us more hesitant about YPF because cash earnings would need to rise to improve the valuation. Likewise, a decline in Price to Cash Earnings to below the average of 6.24 would significantly improve our outlook for YPF given the current profit levels.

YPF Dividends

A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.

When reviewing dividend yields for YPF, we compare the historic high and low levels over the past, which is similar to our evaluation of Sales and Cash Earnings per share. Paying a dividend is not necessary for any company, but changes in dividend often can lend clues as to the health of the business. A rising dividend is a strong sign for an established company, as it reflects management's confidence in the company. YPF’s estimated annual dividend is $7.39 resulting in a current dividend yield of 15.45%. The highest dividend yield from YPF over recent history was 26.35% while the lowest dividend yield was 2.12%. YPF has shown confidence by hiking up the dividend yield to 8.54% above the historical median.