FOR STOCK VALUATION
WHY USE THE POTENTIAL PAYBACK PERIOD (PPP)
INSTEAD OF THE PRICE EARNINGS RATIO (PER)

The Potential Payback Period (PPP) is defined as the period of time necessary to equalize the current stock price with the sum of future earnings per share. Therefore it is a mathematical adjustment of the traditional P/E ratio (PER) to earnings growth rates, thus allowing more meaningful stock comparisons.

Future earnings are discounted to their present value using a long-term interest rate as the discount rate, thus taking into account interest rates in stock valuation.

Image 1

For more details go to https://stockinternalrateofreturn.com/index.html

WORLDWIDE SELECTION OF ATTRACTIVE STOCKS
ON THE BASIS OF THEIR POTENTIAL PAYBACK PERIODS (PPPs)
REGARDLESS OF THEIR PRICE EARNINGS RATIOS (PERs)

(Data as of January 21, 2024)

Companies
(Industries) 		Countries
Price Earnings Ratio
(multiple) 		EPS Growth Rate
(in %) 		Interest Rate
(in %) 		Potential Payback Period (PPP)
(in years)
SALESFORCE
(Customer Services) 		USA 104.9 34% 4.14% 13.55
AMAZON
(E-Commerce, IT) 		USA 79.9 32% 4.14% 13.02
NVIDIA
(AI, Semiconductors) 		USA 77.8 50% 4.14% 9.71
NETFLIX
(Media)		 USA 46.7 20% 4.14% 14.60
MICROSOFT
(Software) 		USA 38.4 13% 4.14% 17.54
ALPHABET
(Media, Technology) 		USA 27.5 18% 4.14% 12.14
DELL TECHNOLOGIES
(Computers, Technology) 		USA 22 14% 4.14% 12.45
Simulation 1 USA -
Simulation 2 USA -
ESSILOR
(Healthcare & Glasses) 		FRANCE 34.3 14% 2.83% 14.47
DANONE
(Food)		 FRANCE 30.3 13% 2.83% 14.69
AIRBUS
(Aeronautics) 		FRANCE 29.3 18% 2.83% 11.76
LVMH
(Luxury Goods)		 FRANCE 20.5 10% 2.83% 12.49
VEOLIA
(Utilities)		 FRANCE 18.8 12% 2.83% 11.53
ORANGE
(Telecommunications) 		FRANCE 18.6 15% 2.83% 9.94
DASSAULT AVIATION
(Aeronautics) 		FRANCE 16.8 13% 2.83% 9.79
Simulation 1 FRANCE -
Simulation 2 FRANCE -
KEYENCE
(Technology) 		JAPAN 44 10% 0.67% 18.33
FAST RETAILING
(Retail) 		JAPAN 37.3 10% 0.67% 16.86
TOKYO ELECTRON
(Semiconductors) 		JAPAN 38.2 12% 0.67% 15.64
SONY GROUP
(Consumer Durables) 		JAPAN 22 7% 0.67% 14.24
FUJITSU
(ICT)		 JAPAN 20.9 12% 0.67% 11.34
NEC
(ICT)		 JAPAN 19.7 12% 0.67% 10.96
HONDA MOTOR
(Automobiles) 		JAPAN 8.3 3% 0.67% 7.68
Simulation 1 JAPAN -
Simulation 2 JAPAN -

Simulations for all data can be conducted on the above charts where new companies can be added for comparison.