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Thread: weekend commentary - looking at (cough, cough) fundamentals

  1. #1
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    Default weekend commentary - looking at (cough, cough) fundamentals

    (snip)"*************************** S&P 500 FUNDAMENTALS ****************************

    The real P/E for the S&P 500 is based on "as reported" or GAAP earnings
    (calculated using Generally Accepted Accounting Principals), and it is the
    standard for historical earnings comparisons. The normal range for the GAAP
    P/E ratio is between 10 (undervalued) to 20 (overvalued).

    Market cheerleaders invariably use "pro forma" or "operating earnings,"
    which exclude some expenses and are deceptively optimistic. They are
    useless and should be ignored.

    The following are the most recently reported and projected twelve-month
    trailing (TMT) earnings and price/earnings ratios (P/Es) according to
    Standard and Poors.

    Est Est Est
    2007 Q4 2008 Q1 2008 Q2 2008 Q3
    TMT P/E Ratio (GAAP).......: 20.7 22.5 24.8 23.6
    TMT P/E Ratio (Operating)..: 16.6 16.9 16.9 16.1

    TMT Earnings (GAAP)........: 66.18 60.95 55.15 57.92
    TMT Earnings (Operating)...: 82.54 81.08 81.17 85.20

    For a more thorough discussion of earnings and other fundamentals
    click here.

    Based upon the latest GAAP earnings the following would be the approximate
    S&P 500 values at the cardinal points of the normal historical value range.
    They are calculated simply by multiplying the GAAP EPS by 10, 15, and 20:

    Undervalued (SPX if P/E = 10): 662
    Fair Value (SPX if P/E = 15): 993
    Overvalued (SPX if P/E = 20): 1324

    ************************************************** ***************(snip)

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Another Web-site, Another Idiot Analysis, More Waste of Time

    There is a reason why Operating Earnings are calculated. But, again if you are coming with 1/4 of a clue, it is tough.

    In fact, Warren Buffett has a similar term called 'Owners Earnings'. But, again we should all believe idiot web-sites than the guy who has made $60 Billion doing Value Investing

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Every Minute spent on this book is worth 1000 Hours spent on shady web-sites written by clueless idiots
    http://www.amazon.com/Essays-Warren-...7540296&sr=8-1


    This is the closest web-site that describes Owner Earnings as Buffett describes

    http://boyboycute.wordpress.com/2008...wner-earnings/

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Quote Originally Posted by xanfiles1 View Post
    ... Idiot Analysis...
    Quote Originally Posted by xanfiles1 View Post
    ... 1/4 of a clue ...
    Quote Originally Posted by xanfiles1 View Post
    ... idiot web-sites ...
    Quote Originally Posted by xanfiles1 View Post
    ... shady web-sites written by clueless idiots ...


    IMHO "The quoted text is incorrect or misleading because of *blah* *blah*" would be a more enlightening way to reply.
    Once again, the conservative, sandwich-heavy portfolio pays off for the hungry investor
    - Dr John Zoidberg

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Quote Originally Posted by person View Post


    IMHO "The quoted text is incorrect or misleading because of *blah* *blah*" would be a more enlightening way to reply.
    The sophistication of his retort expresses the complexity of his/her thought and words.

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    taking economics seriously = clueless

    genocide awaits!

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Quote Originally Posted by princessjefflina View Post
    taking economics seriously = clueless

    genocide awaits!
    I was reading a paper on trading with people in other solar systems which said something like "This is a serious treatment of a ridiculous subject, which is of course the opposite of what is usual in economics"
    Once again, the conservative, sandwich-heavy portfolio pays off for the hungry investor
    - Dr John Zoidberg

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Oh No They Dint

    :o

    oh snap
    decapped i was

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Quote Originally Posted by Deogol View Post
    The sophistication of his retort expresses the complexity of his/her thought and words.
    Let me put it this way,

    Shady Web-site: Market Cheerleaders say 11 * 12 = 132
    Me: I can explain that, Lets start with basics. What is 1 + 1?
    Shady Web-site: -4.
    Me: *Plonk*

    You can't explain to idiots who don't even have basic fundamentals right.

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    well, here's a fundamental to consider ...

    (snip)"U.S. Stocks Fall on Profit Concern; Washington Mutual, AMD Drop

    By Eric Martin

    April 8 (Bloomberg) -- U.S. stocks fell the most in seven days after the first signs of quarterly earnings disappointed investors, Washington Mutual Inc. slashed its dividend and some Federal Reserve officials warned of a prolonged recession.

    Washington Mutual led financial shares lower after the largest savings and loan cut its payout by 93 percent following a $1.1 billion loss in the first quarter. Alcoa Inc., the first Dow Jones Industrial Average company to report results, declined on profit that decreased by more than half. Advanced Micro Devices Inc. dropped on a 22 percent slump in sales. Lennar Corp. led declines in all 15 homebuilders in Standard & Poor's indexes after pending home sales fell more than forecast.

    The S&P 500 lost 6.79 points, or 0.5 percent, to 1,365.75 at 3:54 p.m. in New York. The Dow average slid 30.78, or 0.2 percent, to 12,581.65. The Nasdaq Composite Index declined 14.35, or 0.6 percent, to 2,350.48. Eight stocks dropped for every five that rose on the New York Stock Exchange.

    ``We'll be lucky to see earnings be flat for the year and we'll probably see earnings decline,'' Steven Bleiberg, who helps manage about $6 billion as head of global investment strategy at Legg Mason Asset Management in New York, said in an interview with Bloomberg Television. ``Ultimately you've got to have earnings growth, that's the driver, and I just don't see it happening. There are so many negative signs out there.'' (snip)

    from

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    and here's another 'fundamental' to consider ...



    (snip)"April 14 (Bloomberg) -- Goldman Sachs Group Inc. strategists say the U.S. corporate earnings season got off to an ``awful'' start and shares will drop as companies slash forecasts for the rest of 2008.

    ``We expect generally disappointing results and a swath of lowered profit guidance that will drive the Standard & Poor's 500 Index lower,'' a team led by David Kostin, Goldman's New York- based U.S. investment strategist, wrote in a report today. General Electric Co., Alcoa Inc. and United Parcel Service Inc. reported profits or forecasts that trailed analysts' estimates last week.

    Kostin, 44, said last month that the S&P 500 may finish the year at 1,380, down 6 percent from the end of 2007. The forecast is the most bearish since at least 2000 by Goldman, which profited as other investment banks lost money on subprime mortgages. Morgan Stanley, the second-biggest securities firm, said today that profits are too high relative to the size of the U.S. economy.

    The forecasts conflict with estimates by Wall Street analysts that earnings at S&P 500 companies will rise 14 percent in the third quarter and 55 percent in the fourth. Predictions of a ``speedy recovery'' are too optimistic and stocks will drop when investors view estimates with ``appropriate skepticism,'' Kostin wrote.

    Goldman said worse-than-expected earnings from GE, the world's fourth-largest company by market value, and Alcoa, the third-biggest aluminum producer, are harbingers. Analysts have reduced expectations for S&P 500 earnings growth during the second half of 2008 ``only slightly'' even after cutting first- quarter projections by 17 percent, Kostin wrote.

    Alcoa, UPS

    The S&P 500 retreated 2.7 percent to 1,332.83 last week after GE said the credit-market crisis caused an unexpected earnings decline, while slowing economic growth and rising energy prices eroded profit at Alcoa and UPS. The index slipped 0.3 percent to 1,329 at 11:26 a.m. in New York today."(snip)

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    Default Re: weekend commentary - looking at (cough, cough) fundamentals

    Newsflash: Earnings are down during a recession!

    S&P 500 is undervalued till the P/E reaches 30 or (1/10 Year T-Bill Yield which is 3.5%)

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