Elon Musk wrote to his SpaceX employees Acronyms Seriously Suck, KPN didn't get the memo? https://ir.kpn.com/websites/kpn/English/3011/news-detail.html?newsID=1728525
SECTOR: [PASS] KPN is neither a technology nor financial Company, and therefore this methodology is applicable.
CURRENT RATIO: [FAIL] Current assets €3 081 divided by short-term debt €1 882 = 1.6 which is under Graham's limit of 2.
LONG-TERM DEBT IN RELATION TO NET CURRENT ASSETS: [FAIL] Long term debt €8 290 is higher than Net Current Assets €1 200.
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 €0,16 EPS x €0,67 Book Value) = €1,6
Dividend: € 0,11/€2,4 = 4,5%
Conclusion 2016: KPN is not a growing, money-making machine. The stock price and debt are too high for the Defensive Investor.
Conclusion 2017 at EUR 3 per share: Copy / paste 2016
Conclusion 2018 at EUR 2,4 per share: Unchanged
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