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Strategies & Market Trends : Value Investing

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To: James Clarke who wrote (6361)3/19/1999 6:57:00 PM
From: Tomato   of 78670
 
Could you take a shot at explaining the Peter Lynch earnings line that he has in One Up on Wall Street? As I recall, there was an earnings line and when the stock price line was below the earnings line, the stock was undervalued and if it was above the earnings line it was overvalued. What I never understood was what the earnings line signified, i.e. what formula was used to place the line where it was placed in relation to the stock price.

If I recall correctly, there was one charting service that used this earnings line. Is that true? Is there some way to use his method without subscribing to that charting service?

Thanks in advance.
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