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Strategies & Market Trends : Fundamental Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (3738)

7/8/2014 1:08:55 PM

From: The Ox

Read Replies (1) | Respond to of 4721

I will formally enter FCX as a candidate.
FCX estimates from Yahoo: finance.yahoo.com

I think their future earnings estimates are currently on the low side and that as long as the world economy stumbles forward (at a minimum), the company should do very well over the next 3 years. Copper demand should improve and give them a boost, even though as you pointed out previously, FCX is much more than copper.

I would have no problem swapping out SLW for FCX or taking profits in DIS, adding our cash and buying FCX or AAUKY for that matter.

These aren't "sexy" companies but I think they will do well for the length of our contest.

To: E_K_S who wrote (3738)	7/8/2014 1:50:28 PM
From: bruwin	Respond to of 4721

Interesting video ... somewhere in there was a reference to interest rates and also the fact that factoring in interest rates, especially future predictions, in whatever format one uses, will often result in two individuals arriving at different answers. The Discounted Cash Flow model is a good example ... Of course, there is another method that Buffett uses to do some "price valuation" calculation. His "Equity Bond" approach. In that regard he looks at the last 12 months worth of Pretax Income per share and incorporates the Long Term Corporate Bond Rate. Currently the 10 Year AAA Corporate Rate sits at about 3%. The last 4 Quarterly Pretax Incomes of DIS are (courtesy of ADVFN, I haven't checked against SEC filings) :- Pretax Earning/share for 12 Months = $(6115+2940+7396+2275)mil. = $18726mil./1732mil. shares = $10.82/share So according to this theory of Buffett's, the "Market Valuation" of DIS = $10.82/3% = ~$360/share. Current share price of DIS = ~$86/share < $360/share. So the question is, "Is DIS Overvalued" ? You pays your money and you takes your choice.