Sometimes, over a span of many years, a business will continue to grow, generating ever-increasing a mounts of cash, repurchasing stock, paying increased dividends, reducing debt, opening new stores, expan ding production facilities, moving into new markets, etc, while at the same tune its stock price remain 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 ove80%, 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 half its former price because each share is backed by a larger dividend, twice the earnings power, mon stores, and a bigger infrastructure. Home Depot is in much the same boat, largely because some Wall Stree 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 S 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 In-vestment Survey estimates for earnings per share stand around $2.16(a rise of 54%),the cash dividend has more than doubled to 8 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.
16. This passage is probably a part of
A. Find Hidden Value in the Market
C. Get Good Bargains
17.The italicized word"stagnant"(line 3,Para.1)can be best paraphrased as
C. unchanged D. progressing
18.Wal-Mart is now trading at a much lower price because
A. it has stored a large quantity of goods
B. it has become financially more powerful
C. it has been eager to collect money to prevent bankruptcy
D. it is a good way to compete with other retailing companies
19. All the following are shared by Wal-Mart and Coco-Cola EXCEPT .
A.The cash dividend has increased.
B.The earning power has become stronger.
C. Both businesses have continued to grow.
D. The stock price has greatly decreased.
20. According to the author, one had better
A. buy more shares when the stock price falls down
B.sell out the shares when the stock price falls down
C.do some research on the value of a business when its stock price falls down
D. invest in the business when its stock price falls down
16.A本题考查综合概括能力。文章表明，一个企业在产品销售量、经济规模都不断扩大，但股价却停滞不前时，这种情况的发生，是因为投资者因为太熟悉贸易范围而忽略了公司。因此要发现市场的隐藏价值。When this happens , the average and professional investors alike tend to overlook the company because they become familiar with the trading range.
18.B本题考查综合判断能力。文章指出，较大的红利，两倍的盈利能力，更多的商店，以及更大的基础设施支撑着沃尔玛股票的价格，尽管现在的价格是以前价格的一般。“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."
19.D本题考查综合分析能力。文章指出，沃尔玛的股票价格是以前的一般，而可口可乐的股票处于停停滞态。“Yet,despite the stagnant stock price,the 2006 estimates Value Line Investment Survey...”