Buy Needles And Syringes With No Prescription
M4B Store Banner
juicemasters
Riptropin Store banner
Generation X Bodybuilding Forum
Buy Needles And Syringes With No Prescription
Buy Needles And Syringes With No Prescription
Mysupps Store Banner
fitnespeptidestore
PM-Ace-Labs
Ganabol Store Banner
Spend $100 and get bonus needles free at sterile syringes
Professional Muscle Store open now
sunrise2
PHARMAHGH1
kinglab
ganabol2
Professional Muscle Store open now
over 5000 supplements on sale at professional muscle store
savage
granabolic1
napsgear-210x65
monster210x65
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
DeFiant
UGFREAK-banner-PM
STADAPM
yms-GIF-210x65-SB
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
wuhan2
dpharma
marathon-new-1
zzsttmy
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
azteca
advertise1x
advertise1x
PCT-Banner-210x65
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store
over 5000 supplements on sale at professional muscle store

Blowout Earnings+Fear=Undervaluation

Acadian

Member
Registered
Joined
Feb 20, 2008
Messages
47
The title is an equation for the current atmosphere. Corporations have unexpectedly blown away analysts estimations on performance, and many sit in hoards of cash. With anxiety justifiably in the air due to economic concerns, this has worked to depress share prices. The market at-large is selling at a composite 11x price to earnings, far less than the historical average of 15. The ramification: great businesses are currently "on sale" for a fraction of their intrinsic value. Those who know where these deals are plant the seeds now for future wealth.
 
Prediction is useless, as even the quants with billion-dollar supercomputers can't do it. You can just try to put the odds in your favor. Better to stick to good stock picking than time markets.


For every argument, there is a counter-argument. For example:

The current P/E of the market hardly looks like the all-time bargain: S&P 500 P/E Ratio - Chart

(This is off Prof. Shiller's numbers, so you can put some confidence in them.)

And the three macro things that drive the market the most: 1) the direction of rates, 2) multiple expansion, and 3) the direction of inflation. Currently, rates are essentially zero (or negative if you look at "real" rates). So there is no room for them to go lower. Rising rates have historically coincided with a down market (because higher rates means your discounted future earnings are smaller).

Multiple expansion is a possibility, but with the chart, you can see it won't take much to go into overvalued territory.

That leaves inflation, which is not coming down like it did over the 20 year period of 80s-2000. It is most likely going to rise, again a negative development for the market.

Lastly, companies have blown out earnings because analysts sand-bagged their numbers and the companies have slashed costs/personnel to be conservative. Now that inventories have been refilled (the source of all the earnings for the past few quarters), there needs to be a pick-up in the demand side of the economy. Last I looked, people are still highly levered and no-one is giving out credit. Unless China or the developing world steps up, the demand side won't be there. And you get like Cisco -- who told analysts last week to crank down their projections...
 
Last edited:

Forum statistics

Total page views
599,106,933
Threads
140,832
Messages
2,907,240
Members
162,741
Latest member
Topuria
NapsGear
HGH Power Store email banner
yourdailyvitamins
Prowrist straps store banner
yourrawmaterials
3
raws
Syntherol Site Enhancing Oil Synthol
aqpharma
yms-GIF-210x131-Banne-B
PM-Ace-Labs-bottom
ezgif-com-resize-2-1
MA Research Chem store banner
MA Supps Store Banner
volartek
Keytech banner
dp210-X131
Godbullraw-bottom-banner
Injection Instructions for beginners
finest-gears
PCT-Banner-210x131
FLASHING-BOTTOM-BANNER-210x131
Back
Top