SECTOR: [PASS] KPN is neither a technology nor financial Company, and therefore this methodology is applicable.
CURRENT RATIO: [PASS] Current assets €5 195 divided by short term debt €2 628 = 2.0 which is Graham's limit.
LONG-TERM DEBT IN RELATION TO NET CURRENT ASSETS: [FAIL] Long term debt €8 156 is higher than Net Current Assets €2 567.
LONG-TERM EPS GROWTH: [FAIL] Companies must increase their EPS by at least 30% over a ten-year period and EPS must not have been negative for any year within the last 5 years. EPS for KPN have decreased since 2003 and therefore the company fails this criterion. It has also lost money during the past 5 years.
Earnings Yield: [FAIL] Graham likes to see 7% or higher. 6% fails this test.
Graham Number value: [FAIL] The Price/Book ratio must also be reasonable. That is the Graham number value must be greater than the market price. KPN has a Graham number of √(15 x €0,18 EPS x €0,84 Book Value) = €1,8
Dividend: € 0,11/€3 = 4%
Conclusion 2016: KPN is not a growing, money making machine. The stock price and debt are too high for the Defensive Investor.
Conclusion 2017: Copy / paste 2016
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