The earnings yield is an indication of how much return shareholders' investment in the company earned over the past 12 months. The higher the earnings yield is, the better.
The earnings yield does not consider the growth of the business. A better indicator of the attractiveness of an investment which takes growth into account is the Forward Rate of Return (Yacktman) %. First Capital Bancorp's Forward Rate of Return (Yacktman) % for the quarter that ended in Sep. 2015 was 0.00%. The Forward Rate of Return uses the normalized Free Cash Flow of the past seven years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
First Capital Bancorp Earnings Yield % Calculation
Earnings yield is the reciprocal of the P/E Ratio.
First Capital Bancorp's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2015 adds up the quarterly data reported by the company within the most recent 12 months, which was $0.329 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
It can also be calculated from the numbers for the whole company:
The earnings in the calculation is the Trailing Twelve Months earnings.
First Capital Bancorp (NAS:FCVA) Earnings Yield % Explanation
If the P/E ratio is an indication of how many years it takes for the company to earn back the stock price shareholders pay to buy the shares, the earnings yield is an indication of how much return shareholders' investment in the company earned over the past 12 months. The higher the earnings yield is, the better.
If a company loses money, the earnings yield is negative. This gives a more straightforward indication that the company is losing money. This is an advantage of using earnings yield instead of the P/E ratio in valuation. For valuation purposes, the P/B Ratio and the P/S Ratio should be used for companies that are losing money.
Like the P/E ratio, the earnings yield can be used to compare investments in different industries. It can even be used to compare the attractiveness of different asset classes such as bonds and cash. Of course, the earnings yield should not be the only factor in deciding which asset classes to invest.
Also similar to the P/E ratio, the earnings yield does not consider the growth of the business. A growing company with the same earnings yield should be more attractive than a company that has the same earnings yield but does not grow.
Just like the P/E Ratio, non-recurring items such as selling part of the business, selling a previous investment, etc., can affect earnings yield dramatically. The earning yield is also a poor indication for cyclical companies. When a cyclical stock has a high earnings yield it is usually at the peak of its cycle.
First Capital Bancorp Earnings Yield % Related Terms
Thank you for viewing the detailed overview of First Capital Bancorp's Earnings Yield % provided by GuruFocus.com. Please click on the following links to see related term pages.
First Capital Bancorp (First Capital Bancorp) Business Description
First Capital Bancorp Inc was incorporated under Virginia law in 2006. The Company is a bank holding company and conducts its operations through its wholly-owned subsidiary, First Capital Bank. The Bank is a community oriented financial institution that offers a range of banking and related financial services to small and medium-sized businesses, professionals and individuals located in its market area, which consists of the Richmond, Virginia metropolitan area, with a current emphasis on western Henrico County, Chesterfield County, the City of Richmond, the Town of Ashland, and the surrounding vicinity. It offers a range of deposit services including checking accounts, NOW accounts, savings accounts and other time deposits of various types, ranging from daily money market accounts to longer-term certificates of deposit. The transaction accounts and time certificates are tailored to its market area at rates competitive to those offered in the area. In addition, it offers certain retirement account services, such as Individual Retirement Accounts, or IRAs. The Bank also offers a range of short-to-medium term commercial and consumer loans. Commercial loans include both secured and unsecured loans for working capital, including inventory and receivables; business expansion, including acquisition of real estate and improvements; and purchase of equipment and machinery; Consumer loans include secured and unsecured loans for financing automobiles, home improvements, education and personal investments. It originates fixed and floating-rate mortgage and real estate construction and acquisition loans. Other services it offers include safe deposit boxes, certain cash management services, traveler's checks, direct deposit of payroll and social security checks and automatic drafts for various accounts, selected on-line banking services and a small and medium-sized businesses courier service. The Company competes with other commercial banks, savings and loan associations, credit unions, mortgage banking firms, consumer finance companies, securities brokerage firms, insurance companies, money market mutual funds and other financial institutions operating in the Richmond metropolitan area and elsewhere. As a bank holding company, the Company is subject to regulation under the Bank Holding Company Act of 1956, as amended, and the examination and reporting requirements of the Board of Governors of the Federal Reserve System.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
FCVA has been successfully added to your