Here’s Why Stock Prices Don’t Matter And What You Can Use Instead To Value Companies
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Hello 👋 I’m Humphrey, I used to be a financial advisor, worked in gaming/tech, and started my own eCommerce business. I make practical, rational content on investing, personal finance, the news, and much more with a data-backed approach. My goal is to help you with financial literacy and creating wealth.
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Thanks Humph😤
Yeah but this implies growth if it is high. But how do you value growth when some of these QC stocks are trading insane ratios. At least with AMD you could come up with some arbitrary growth metrics like yoy revenue increase and then if you don’t see this met you consider it expensive. Very wishy washy stuff these days, nothing trading sensibly and too much over speculative trading.
The P/E ratio simply says how much of a “premium” investors are willing to pay for the stock compared to how much they are currently earning… If its high, it means investors are generally bullish on it… If its low it means investors are bearish on it.
If investors are wrong or swings were caused by a transient event (e.g., headline, covid, etc.) then it could imply the stock is over/undervalued.
Appreciate the detailed breakdown! Just a quick off-topic question: My OKX wallet holds some USDT, and I have the seed phrase. (alarm fetch churn bridge exercise tape speak race clerk couch crater letter). How should I go about transferring them to Binance?
Great content, thanks for sharing! A bit off-topic, but I want to ask: My OKX wallet holds some USDT, and I have the seed phrase. (iron observe slam major mad decorate feed photo awesome vast kitchen faint). How should I go about transferring them to Binance?
Remember this is TRAILING PE, or basically the current price divided by the past 12 months net income after paying preferred shareholders. FORWARD PE is another metric based on an estimated prediction of the next 12 months earnings. A lower forward compared to trailing signifies a belief in earnings growth. Hey Humphrey, PEG is another earning growth valuation metric to share with your curious viewers✌️
Can you explain Dividend Discount Model for stock valuation
I’ve just begun learning about value investing, and I’ve found that many good stocks are undervalued despite their intrinsic value. If you had $100,000 to create a strong investment portfolio, which stocks would you choose for better returns?
I think a good investment portfolio should have three basic things: ETFs for diversification, dividend stocks for cash flow, and leading tech stocks. With your budget, it’s a good idea to talk to a fiduciary financial advisor for expert advice.
Agreed, people often underestimate the role of financial advisors. Over 30 years of data reveal that those who work with advisors typically earn more than those who do it alone. I’ve been fortunate to work with one for 5 years now, resulting in a million portfolio.
Thanks for sharing your experience! I’ve been managing my portfolio myself, but it’s not working out. Do you have any recommendations for a good investment advisor? I could really use some help.
Judith B. Richards a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
I just looked up her website on google and I would say she really has an impressive background in investing. I have sent her an email hope she gets back to me soon. Thanks
I hope you keep the series on these topics going
Funny you think Apple and Google are in the same industry 😂
You’re the best
Lower PE is better?
Apple will crater hard.
No innovation from 5 years ago