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Comparing EPS Vs. Operating Cash-Flow Per Share (OCFPS) - A Lesson On Earnings Quality
- The concept of Earnings per Share (EPS) is not well understood by retail investors.
- Operating Cash Flow per Share (OCFPS) is less well understood than the concept of EPS.
- The litmus test for earnings quality is cash-flow coverage of net income.
- GAAP vs Non-GAAP while important, isn't nearly as telling as cash-flow vs net income.
Walgreen Earnings Preview: Fiscal '15 Could Be Bumpy - Waiting On Better Valuation
- The inversion premium is out of the stock.
- WAG is now a cost cutting story;
- WAG lowered guidance when they announced abandonment of tax inversion.
- S&P 500 Earnings Update: Finally, A Jump In The Forward Estimate Growth Rate
Twitter - EPS And Revenue Estimates Still Headed Higher - Like For A Trade
- TWTR is free-cash-flow positive, but just starting to ramp.
- Revenue and EPS estimates have been headed north.
- Like the stock to at least $65.
- Valuation looks absurd, but model just starting to leverage.
Ford Investor Day, Monday Sept. 29: Stock Potentially Trading At 30% - 35% Discount To Intrinsic Value
- Ford holding an Investor Day, Monday Sept. 29, '14.
- Stock has been in trading range all year, after December '13 guidance;
- Europe is recovering;
- Think intrinsic value is $23 - $25 per share.
- Risk to stock is the $14 per share price level;
Nike Earnings Preview: The Global Brand Juggernaut
- One of the premier global consumer brands today.
- The stock always looks expensive, which global brands always do.
- Nike returning all free-cash-flow to shareholders.
Micron Earnings Preview: Think Intrinsic Value High $30s, Low $40s
- MU's valuation is still reasonable.
- Love the free-cash-flow generation post-Elpida; 9% current free-cash-flow yield.
- Sustainability of free-cash-flow is key metric.
- Forward EPS and revenue estimates still appear conservative.
Lennar Earnings Preview: The Quandary Is Decent Growth, Attractive Valuation, But Slowing Orders
- LEN average estimated EPS and revenue growth for next 3 years is 20% and 19% respectively.
- LEN is more a mid-range homebuilder vs TOL at the high end.
- Order growth has been slowing for homebuilders.
FedEx Earnings Preview: Returning Capital To Shareholders, But At What Price ?
- The share repo should be almost done.
- Given paltry free-cash-flow, FDX adding debt.
- Think stock is fairly valued here, although crude oil drop very helpful.
Oracle Earnings Preview: Fairly Valued, Is Oracle Now Secular Mid-Single-Digit Grower?
- Dividend payout and dollars should increase as % of free-cash-flow.
- More share repurchases being used to absorb insider sales.
- I wonder if ORCL now a cash-cow with mid-single-digit secular growth ?
Merck Vs. Pfizer: Merck Better Performer, Pfizer Better Risk-Reward
- Valuation metrics are very similar.
- Slight edge to Merck on expected earnings growth.
- Slight edge to Pfizer on dividend yield and cash flow valuation.
S&P 500 Weekly Earnings Update: Q3 '14 Earnings Revisions Return To Normal
Tue, Sep. 9 • Comment!
- Chart Of 10-Year Treasury Yield Tells You Everything
- A Quick Look At The S&P 500 By Sector Market Cap
Toll Brothers Earnings Preview: Attractive Multiple, But Range Bound For 2 Years Now
- Relative to earnings and revenue growth, the stock looks cheap;
- Stock has been locked in trading range for 2- 3 years.
- QE3 was targeted at mortgage market - Taper could be having impact.
- New single-family home data has been gradually slowing.
- S&P 500 Weekly Earnings Update: Still Looking For $120 For Full-Year 2014 EPS
Ford Vs. GM: Still Love Ford, But GM At 34%-35% Discount To Intrinsic Value
- Estimated intrinsic value for GM is mid-$50s.
- Estimated intrinsic value for F is low $20s.
- Both are trading at discounts to intrinsic value, with GM at a bigger discount.
Bernanke Says 2008 Worse Than Great Depression
Thu, Aug. 28 • 22 Comments
J.C. Penney: Cash-Flow Improvement, But Dilution Is The Risk
- Looks like a technical breakout today in J.C. Penney.
- The last earnings report showed a sharp reduction in free cash flow deficit.
- The retailer still not expected to show a profit until 2018.
Hewlett-Packard Earnings Preview: 4X Cash Flow, Ex Balance Sheet Cash - Still A Fan
- Valuation still reasonable.
- Still worried about revenue growth or lack thereof, which is biggest negative to HPQ's story.
- Resurgent PC business the biggest plus last 3 quarters.
- Cash-flow and free-cash-flow valuations biggest positive.
Home Depot / Lowe's Earnings Previews: Both Retailers Fairly-Valued In A Heavy Housing Market
- DIY Home Improvement will lag with Housing.
- Both HD and LOW are close to fairly valued, with a slight edge to LOW.
- Home Depot less susceptible to shocks; If only LOW could expand operating margin.
J.C. Penney Earnings Preview: Some Improvement, But Cash Flow Is King
- Rev growth in fiscal Q1 '15 best since mid-2011.
- April traffic comp was first positive comp in 30 months.
- Positive cash-flow from operations the next critical step.
Wal-Mart Earnings Preview: Low Expectations As Traffic Continues To Erode
- Forward EPS and revenue estimates have been negative.
- It isn't the international segment but the US segment that is under pressure.
- Stock pops when US comp's start to rise.
- WMT "traffic" comps have declined for 6 straight quarters.
Cisco Earnings Preview: Stock Fairly Valued Here As Core Business Still Struggles
- Cisco (CSCO) still stuck in a trading range.
- Revenue and EPS estimate revisions showing some positive revisions.
- Core Router and Switching businesses still expecting negative growth.
Microsoft Earnings Preview: More Fully Valued Today, But Satya Wasting No Time
- Looking at the numbers, revenue versus EPS growth, the job cuts make sense.
- Revenue estimate and revisions remain positive.
- Stock is far less undervalued today.
Peabody Earnings Preview: How Hated Is Coal? Peabody Requires Patience
- Stock hasn't made new low since mid-2013.
- Stock down 3% today.
- $14.34 is the July '13 low print. $87 - $88 and $73 - $74 were the '08 and March '11 highs.
GE Earnings Preview: 'The Incredible Shrinking GE', Or 'Where's The Beef'?
- GE Capital which is closer to 50% of GE EPS, continues to shrink.
- Is Alsthom the answer?
- Horribly frustrating stock, but you need the GE's for limiting downside portfolio risk.
IBM Earnings Preview: Low Expectations, Revenue Revisions Negative, Stock Modestly Undervalued
- Quality of earnings and lower cash-flow a big concern.
- Estimate revisions for '14 and '15 still forecasting low-single-digit revenue growth.
- The quality of IBM's 2015 EPS goal of $20 per share is being questioned.
Intel Earnings Preview: Has The Company Finally Turned A Corner?
- The June 2014 upside surprise announcement was good news.
- Ironically, it came from the legacy PC biz.
- The dividend and free cash flow are key metrics for growth sustainability.
- Our model indicates INTC still trading at a 17%-20% discount to intrinsic value.
Apple Earnings Preview: Valuation Reasonable And Forward Estimates Moving Higher
- Valuation is still very reasonable at 15(x) '14 EPS.
- Margin compression looks to be ending.
- EPS and revenue estimates starting to turn higher.
Goldman/Morgan Earnings Previews: Is The Goldman/Morgan Banking Model A Fading Relic?
- Dodd-Frank and the regulators seem to be targeting volatility.
- In terms of the financial system, there is a higher premium being put on stability and certainty.
- Choose asset gatherers which have more consistent and dependable earnings results.
Schwab Earnings Preview: Is Schwab's 'Core EPS' $2 Per Share?
- Rising stock prices and an interested retail investing base has reinvigorated the stock.
- The money-market fee waiver is masking about $0.50 in EPS.
- The dividend and share repo is has been dormant for years - time to return more capital?