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

To: Paul Senior who wrote (76936)	1/13/2025 4:37:55 PM
From: bruwin	Respond to of 78958

"I don't want to pay more than 21x earnings" So that's equal to (Net Income/Shares)x21 = ($11624/2843)x21 = ~$86/share. Well ..... Buffett's Equity Bond calculation is = Pretax Income/shares/AAA Bond Rate = 13206/2843/5.5% = ~$85/share. Quite the coincidence ....... Of course ORCL's share price needs to fall by 44% for that to occur.

To: Paul Senior who wrote (76936)	1/13/2025 6:35:15 PM
From: E_K_S	Read Replies (1) \| Respond to of 78958

GARP stocks - What's a reasonable 'Value' price I am pretty much w/ you on that low 20x PE and certainly not anything above 35x. The big trade I missed was bruwin's buy of AMAT back in 2012. How would one know at the time that AMAT's machines would be used in every semiconductor Fab around the world. I find the PEG ratio, or Price/Earnings to Growth ratio,(a financial metric used to evaluate a company's stock price in relation to its expected earnings growth) is a good metric for measuring value growth. Anything at/below 1 is excellent. AMAT meets that but not ORCL. Even now, AMAT w/ a 18.88x Forward PE & PEG of 1.81 is not unreasonable. ORCL at 34x PE and a 3.2 PEG to me is in the overvalued range. Here is a table of PE, PEG vs $SOX & $SPX One can get lucky but sticking firm on your PE entry and PEG metrics makes for a good GARP investor. Also patients and buying when the major indexes are in your GARP range too.