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Strategies & Market Trends : Fundamental Value Investing

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To: E_K_S who wrote (4670)7/1/2025 11:30:24 AM
From: bruwin  Read Replies (1) of 4719
 
One often reads of the "Forward P/E" predictions that are put forward. It would be interesting to discover what the Historical Accuracy has been of these predictions when one bears in mind that there are two variables involved, i.e. "P" and "E", where "P" is probably the more unpredictable and can be prone to wide fluctuations from a wide range of influencing factors.

The "E" component does appear to be closely aligned to the share price of a stock as can be seen in the yellow component in these two examples. Possibly most likely because investors are very much influenced by the Quarterly Financial Results where they probably take careful notice of the "Net Income" figure from which "E" is obtained. That also produces the Dividend, if one is paid, as well as adding, hopefully Positively, to the "Retained Income" number on the Balance Sheet which will therefore, in turn, increase Total Assets relative to Total Liabilities ----->

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