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  3. Sometimes, over a span of many years, a business will continue to grow, generating ever-increasing amounts of cash, repurchasing

Sometimes, over a span of many years, a business will continue to grow, generating ever-increasing amounts of cash, repurchasing

admin2011-04-21  58
问题     Sometimes, over a span of many years, a business will continue to grow, generating ever-increasing amounts of cash, repurchasing stock, paying increased dividends, reducing debt, opening new stores, expanding production facilities, moving into new markets, etc. , while at the same time its stock price remains stagnant (or even falls).
    When this happens, the average and professional investors alike tend to overlook the company because they become familiar with the trading range.
    Take, for example, Wal-Mart. Over the past five years, the retailing behemoth has grown sales by over 80%, profits by over 100%, and yet the stock price has fallen as much as 30% during that timeframe. Clearly, the valuation picture has changed. An investor that read the annual report back in 2000 or 2001 might have passed on the security, deeming it too expensive based on a metric such as the price to earnings ratio. Today, however, the equation is completely different—despite the stock price, Wal-Mart is, in essence, trading at half its former price because each share is backed by a larger dividend, twice the earnings power, more stores, and a bigger infrastructure. Home Depot is in much the same boat, largely because some Wall Street analysts question how fast two of the world’s largest companies can continue to grow before their sheer size slows them down to the rate of the general economy.
    Coca-Cola is another excellent example of this phenomenon. Ten years ago, in 1996, the stock traded between a range of $ 36. 10 and $ 54. 30 per share. At the time, it had reported earnings per share of $ 1. 40 and paid a cash dividend of $ 0. 50 per share. Corporate per share book value was $2. 48. Last year, the stock traded within a range of $40. 30 and $ 45. 30 per share; squarely in the middle of the same area it had been nearly a decade prior! Yet, despite the stagnant stock price, the 2006 estimates Value Line Investment Survey estimates for earnings per share stand around $ 2. 16 (a rise of 54%), the cash dividend has more than doubled to $1.20, book value is expected to have grown to $ 7. 40 per share (a gain of nearly 300%), and the total number of shares outstanding (未偿付的，未完成的) has actually decreased from 2. 481 billion to an estimated 2. 355 billion due to the company’s share repurchase program.
The italicized word "stagnant" (Line 4, Para. 1) can be best paraphrased as______.
选项 A、prominent
B、terrible
C、unchanged
D、progressing
答案C
解析 词汇理解题。第一段的意思是，有时一个企业不断扩展自己的业务，但是它的股票价格依然“stagnant”甚至是下降，从整段的意思可以推出stagnant是不变的意思，所以正确答案是C选项。
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