You know, I don't believe your claim that you want "intelectual discussion". You are convinced that you are right and that I am wrong. And that's that. :)
Yes, I have read Graham. Through his long career he has made various claims, so I can easily find statements supporting both your position and my position. I don't see a point in that.
I don't dispute your right to adjust the numbers anyway you like. You may get benefit from it or not.
Personally, I am somewhere in between you and Paul Senior. :) I do use EV, I sometimes calculate ROIC (though rather plain one, not the complicated ones you mentioned in another post). Most of the time I don't, since I just don't look at companies that are very levered. I do DCF (or rather D-Earnings) though most people would dismiss the way I do it as crude and not reflecting reality.
I personally don't "follow" anyone, I make my own decisions of what matters and what doesn't.
I agree that companies can play games in financial statements. IMHO though, if you consider the company as your adversary who's trying to mislead you, you are better of moving to another company that doesn't, rather than trying to dig out the actual numbers of the company that tries to game the numbers. Unless you want to go short, there is practically no point of going long company you don't trust.
On the other hand, most companies do some financial engineering. IMHO trying to get to the bottom of every such thing is usually counterproductive. In other words, I don't see that as time well spent. But others might disagree.
You did not answer my question: did you buy the stock? |
