I have found that enterprise value to operating earnings and prices to sales and operating cash flows are the most reliable indicators of a stock’s intrinsic value, presuming the company is a quality enterprise with high returns on equity and invested capital generating superior free cash flows.
@absolutetotalcompound - Thanks for your reply and suggestions! I am also a big fan of Lynch and Buffett/Munger/Li Lu.
Quality Value Investing achieves alpha by investing in a company’s current wealth and a stock price’s present value. PEG and it’s derivatives are speculative predictive analyses that are used only as tiebreakers not tiemakers in the QVI model.
Predictive analysis such as PEG reminds me of this quote published in The Wall Street Journal in 1993 that still holds today:
“There are two kinds of forecasters: those who don’t know and those who don’t know they don’t know.” —Economist John Kenneth Galbraith to The Wall Street Journal.
I have found that enterprise value to operating earnings and prices to sales and operating cash flows are the most reliable indicators of a stock’s intrinsic value, presuming the company is a quality enterprise with high returns on equity and invested capital generating superior free cash flows.
@absolutetotalcompound - Thanks for your reply and suggestions! I am also a big fan of Lynch and Buffett/Munger/Li Lu.
Quality Value Investing achieves alpha by investing in a company’s current wealth and a stock price’s present value. PEG and it’s derivatives are speculative predictive analyses that are used only as tiebreakers not tiemakers in the QVI model.
Predictive analysis such as PEG reminds me of this quote published in The Wall Street Journal in 1993 that still holds today:
“There are two kinds of forecasters: those who don’t know and those who don’t know they don’t know.” —Economist John Kenneth Galbraith to The Wall Street Journal.