After reading a Barron's article(August 25 Page 20) on how Morgan Stanley finds undervalue stocks I was pretty impressed with their easy method. it goes like this.
Find Stocks that have low P/E ratio's divided by the estimated growth rate.
For example XYZ has a P/E of 9 and a estimated growth rate of 20% yearly then they would have a P/E to Growth rate of .45(lower the number the better)
I would like the thread to follow several criterias:
1) P/E to growth ratios under 1
2) State exactly who is giving out the estimated growth is it value line, magazine article, management, major analysts......
3) Why in your opinion is the stock trading at such low multiples(Technology questions, industry downturn, inflation,............). There usually is some reason behind the low valuation.
4) Market Cap of at least 500 Million
Good Luck,
John |
