Who else is glued to the DOW?

[slow99]

Buy rmcp it will go to .40 in the next few mos

Lmao

[thesource]

A couple of more days like today and I am going to tap into my savings to load up for a nice rebound!

[momo]

How did you arrive at 8000? That'd imply about a 8.5x FY'12 P/E.

wild guess. i just feel like that's the number I would feel is a decent bottom.

i have no clue what 8.5x FY'12 P/E translates to or how or especially why that is of importance. feel free to explain if you have time though!

[kingjason]

I will take 6800 for the bottom.

[slow99]

wild guess. i just feel like that's the number I would feel is a decent bottom.

i have no clue what 8.5x FY'12 P/E translates to or how or especially why that is of importance. feel free to explain if you have time though!

Ha, ok.

8.5x 2012 earnings. That would be very cheap. I don't know that we even sniffed that in Feb 2009. I posted here months ago that I'd be more comfortable buying at 11k (12x P/E). At 8x I'm maxing the margin account.

[slow99]

I will take 6800 for the bottom.

And that would be 7.2x '12 earnings. Pretty damned sure we didn't even sniff that in Feb 2009.

[SMKR]

And that would be 7.2x '12 earnings. Pretty damned sure we didn't even sniff that in Feb 2009.

What buys are on your radar?

[momo]

Ha, ok.

8.5x 2012 earnings. That would be very cheap. I don't know that we even sniffed that in Feb 2009. I posted here months ago that I'd be more comfortable buying at 11k (12x P/E). At 8x I'm maxing the margin account.

the dow hit 7000 in Feb 09, the bottom was first week of march at 6600.
i don't know how to calculate what you did there.

[slow99]

the down hit 7000 in Feb 09, the bottom was first week of march at 6600.
i don't know how to calculate what you did there.

No worries. When assessing the true value of something, I can't just throw out "I think it's worth xx". This is what I do this for a living. If you ever hear on TV or the radio that a stock is trading up or down b/c an Analyst upgraded/downgraded it... my team does that. We set price targets for stocks, ie, what we think they are worth on a per share basis.

We cover 17 names right now. We have "buy" ratings on 4, "sell" ratings on 3 ,and "hold" ratings on 10. When I say what I think a company is worth (ie, "value it") we usually do what's called EV/Sales. Ev = enterprise value in the donominator over our 2012 revenue projection for the company. We use EV b/c it takes capital structure out of the equation (when you have a group of companies you're comparing with differing degrees of debt) . You compare a company against its historical self, and a group of comparables and use your judgement to assess how attractive it is at its current price level.

The most common multiple is P/E (price per share now/over next year's projected earnings per share). Compare that against a comp group and its historical self. For Financial companies you use Price to book (book value of equity) because Financial companies' earnings power isn't represented by their sales, it's represented by their assets.

You could also use a discounted cash flow methodology, sum of the parts, etc. to value an asset.

Al P does this for a living, involving Commerical Real Estate. Those guys determine value using a thing called a Cap Ratio.

I guess the point is, we have to use defensible, theoretically sound methodologies to value assets. There are myriad ways to do this, some much better than other depending on the characteristics of the asset.

Dow 8000 would be dirt cheap. (In this shit, who knows we could see it!)

[momo]

The most common multiple is P/E (price per share now/over next year's projected earnings per share). Compare that against a comp group and its historical self. For Financial companies you use Price to book (book value of equity) because Fiancial companies earnings power isn't represented by their sales, it's represented by their assets.
a

where do you get the figures for next years projected earnings per share?

[slow99]

where do you get the figures for next years projected earnings per share?

We build financial models based on our opinions of the company's prospects, company guidance, our channel checks, the macro environment, etc.

[slow99]

where do you get the figures for next years projected earnings per share?

Go to Yahoo or Google Finance. Put in a ticker symbol/quote. On the side go to "Analyst Estimates". Once you're there, you'll see figures for revenue and earnings for the next quarter, year, etc. Those numbers on Yahoo Finance come from my group and my competitors.

[slow99]

What buys are on your radar?

It's best practice for me to not publicly push names.

[momo]

Go to Yahoo or Google Finance. Put in a ticker symbol/quote. On the side go to "Analyst Estimates". Once you're there, you'll see figures for revenue and earnings for the next quarter, year, etc. Those numbers on Yahoo Finance come from my group and my competitors.

perfect. thank you. i've been burnt by untimely analyst downgrades, missing earning figures... hell even meeting expectations has left me in the red a few times. it's about time i learn how this works to avoid that again.

[347Mike]

Lmao. Everyone wants to talk stocks now that shit has hit the fan. I will be moving half my savings into my scottrade account later this week. I don't see any slowing down this week.