Benjamin Graham's Perspective on the Dow Jones [View article]
Are you sure they are lower than the last four quarter EPS? I used trailing EPS from the last year. MRK has an EPS of 0.27 and AA has an EPS of 0.22; I crosschecked my data sources with Google Finance and I seem to be correct. Your point is also valid. The current year's forecast should be included in a fundamental model. However, Graham suggested using 4 quarter trailing EPS which I used here.
Benjamin Graham's Perspective on the Dow Jones [View article]
As an investor and economist, Benjamin Graham suggested many rules. They use a more restrictive rule where the Price to Book value ratio is essential. The formula I used was more academic: It is based on linearization of discounted future earnings model. Surely, the formula needs some more improvement (I need to factor in bond yields) Hopefully, I will come with a better article once I prove that formula is based on a fundamental model.
Benjamin Graham's Perspective on the Dow Jones [View article]
No. It is the average annual Expected EPS growth in next 5-10 years. This data is based on estimation. Therefore, it has a error margin (which can be quite large). I guess they survey the "experts" about future earning estimates. This is how they find the estimates.
Benjamin Graham's Perspective on the Dow Jones [View article]
If I am not mistaken, the website uses the following rule: The P/E multiplied by P/B < 22.5. From my point of view, this rule of thumb (which also belongs to Graham) is outdated. Companies real asset values are much higher than accounting-based book values.
Example: The accounting value of a 5-year old automotive/truck will be zero if that company use a 5-year linear depreciation rule.
Benjamin Graham's Perspective on the Dow Jones [View article]
There is no benchmark EPS. EPS is a dynamic concept. (EPS = Earnings per Share) It depends on both earnings and number of shares. Earnings depend on economic outlook whereas # of shares depend on executive board's [discrete] decision. If you are looking for a range, you should look for P/E ratio. For DJ stocks P/E ratio range between 10 to 20 (15 is normal)
Benjamin Graham's Perspective on the Dow Jones [View article]
In short run, stock prices behave according to "Random Walk" theory. It is almost impossible to estimate the future prices in short-run. However, in long term earnings per share trend upward for 3 major reason: 1) Inflation 2) Economic Growth 3) Stock Buyback
Surely, Macquarie looks like promising company. However, Macquarie's revenues are not large enough to make it into Top 20 list. Maybe, it could be in Top 50.
Benjamin Graham's Perspective on the Dow Jones [View article]
That is an excellent question. Margin of safety is a method that works in the long term. However, people have different motivations in their investment. Some look for high dividends, some look for high growth, some look for speculative stocks.
The Best and Worst Energy Companies [View article]
Dear Sanitychecker,
Thank you for the constructive comments.
I decided to extend the research to include the correlation of 18 companies, retail gasoline price and KMP stocks. The results are strikingly interesting. KMP is not just highly but extremely correlated with oil stocks and oil prices. KMP stock price is almost perfectly correlated with major oil & gas stocks such as Apache (0.907), Anadarko (0.903) and Exxon (0.894). Correlation with Concho was also high (0.888)
For details, I posted a microblog. You can find it here: seekingalpha.com/insta... I am always looking for more education and training. SA is a great website for interactive learning.
Note1: If KMP was in existence for 14 years, how google finance can offer KMP Stock data from the year 1992? Note2: I wish I was retired and had a lot of time to do some cherry picking and play with data. But this is all I have
Top 9 Energy Stocks with Great Dividends [View article]
Dear Long_on_oil,
I was planning to buy TOT shares but after learning about 25% cut, I am undecided. Total pay dividends twice a year. I wonder whether I can buy these stocks and sell them right before dividend date to avoid taxes? Then I will buy them again and hold it until next dividend date? Does that seem like a logical idea?
Benjamin Graham's Perspective on the Dow Jones [View article]
That is a perfect question. Margin of safety is one of the success methods used by prominent investors. It may not work in short run, but backtesting simulations suggest that it works well in long run.
Benjamin Graham's Perspective on the Dow Jones [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
The P/E multiplied by P/B < 22.5.
From my point of view, this rule of thumb (which also belongs to Graham) is outdated. Companies real asset values are much higher than accounting-based book values.
Example: The accounting value of a 5-year old automotive/truck will be zero if that company use a 5-year linear depreciation rule.
Benjamin Graham's Perspective on the Dow Jones [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
1) Inflation
2) Economic Growth
3) Stock Buyback
The Revival of Investment Banks [View article]
Top 9 Energy Stocks with Great Dividends [View article]
Benjamin Graham's Perspective on the Dow Jones [View article]
The Best and Worst Energy Companies [View article]
Thank you for the constructive comments.
I decided to extend the research to include the correlation of 18 companies, retail gasoline price and KMP stocks. The results are strikingly interesting. KMP is not just highly but extremely correlated with oil stocks and oil prices. KMP stock price is almost perfectly correlated with major oil & gas stocks such as Apache (0.907), Anadarko (0.903) and Exxon (0.894). Correlation with Concho was also high (0.888)
For details, I posted a microblog. You can find it here:
seekingalpha.com/insta...
I am always looking for more education and training. SA is a great website for interactive learning.
Note1: If KMP was in existence for 14 years, how google finance can offer KMP Stock data from the year 1992?
Note2: I wish I was retired and had a lot of time to do some cherry picking and play with data. But this is all I have
Top 9 Energy Stocks with Great Dividends [View article]
I was planning to buy TOT shares but after learning about 25% cut, I am undecided. Total pay dividends twice a year. I wonder whether I can buy these stocks and sell them right before dividend date to avoid taxes? Then I will buy them again and hold it until next dividend date? Does that seem like a logical idea?
Benjamin Graham's Perspective on the Dow Jones [View article]
10 Growing Energy Stocks With Great Dividends [View article]