I've also been feeling that its time to sell utes and I feel uneasy about pharmaceuticals as well.
Out of curiousity, I took a quick look at the numbers comparing ATO with AMGN, ZMH, GOOG and AAPL, the stocks you mentioned.
ATO is selling at 134% of its 5 year avg. P.E. AMGN is also above 100% in this metric and the three other stocks are selling at a discount to their 5 yr. avg. PE.
Then, I looked at their p/b and ATO comes in at the cheapest. Or the rest, only ZMH had a p/b of >2.
I also looked at each stock's 5yr avg. net profit margin. ATO barely squeecks out a profit while the other stocks ranged from 18-26%.
And for kickers, I looked at each stock's GN. ATO is selling at just about its GN. ZMH just above its GN and the rest are selling at huge premiums to their GN.
I should look at other metrics as well, debt particularly, but this is as far as my curiosity will take me.
Conclusion: Same as yours. Based on al of the above metrics, ATO is not a bargain. And the other stocks you mentioned may not qualify using GN, but based on the other metrics may present a better value, noting that different sectors are generally given different book value weight by the market.
I suspect that using EKS' GN method; applying expected EPS instead of reported EPS might make a value case for GOOG or AAAPL but not for ATO. And if so, and one happened to be inclined, it would be a good start for further evaluation. |
