Site menu

Search by ticker code:
Generic filters


Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Two ways to assess the JB Hi-Fi (ASX:JBH) share price

Electronics retailer JB Hi-Fi Limited (ASX: JBH) is a brand almost any Australian would be familiar with.

Long-term shareholders have also been handsomely rewarded. Its shares IPO’d at around $1.50 back in 2003, meaning a capital return of over nearly 3000% based on the current share price of $45.54

Here are just a few ways I look at analysing a company like JB Hi-Fi.

Source: Rask Media JBH 2-year share price chart

Return on equity

A useful metric to look at is a company’s return on equity (ROE), calculated by dividing its net income by shareholder’s equity.

Put simply, it’s measuring how well a company can use raised money from shareholders to drive profitability within the business. If a business generates low returns on equity, the returns you make as a shareholder might also be low as well.

JB Hi-Fi generated a ROE of 41.9% in FY21. This was likely elevated due an increased demand from COVID. But under normal conditions, it consistently generates an ROE of around 25%.

This is far higher than other Australian retailers such as Harvey Norman Holdings Limited (ASX: HVN), Premier Investments Limited (ASX: PMV) and Super Retail Group Limited (ASX: SUL).

This is a good indication that JB Hi-Fi management are efficient capital allocators.

Workplace culture

Assessing workplace culture can often provide some useful insight into a business and it’s quite often overlooked.

Given the size of JB Hi-Fi, we might have friends or family who work there who could tell us their experience. If not, we can use websites like Seek company reviews or Glassdoor which provide ratings from past and current employees.

On Glassdoor, 81% of employees said they would recommend working there to a friend and it scored 4.1 stars overall.

If staff are satisfied, the business can retain key talent and divert more spending into other areas of the business instead of hiring efforts.


There are just two ways I often use to look at companies I’m interested in.

Valuation can also play a key role when assessing investment ideas.

If you’re looking to learn how to do your own ASX company valuations, take our free share valuation course, which takes you through 6 common share valuation techniques, step by step.

Or try our Beginner Shares Course if you’re just starting out. Both are free.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.”
Skip to content