Sentences with phrase «high multiple stocks»

If you're a growth stock investor buying high multiple stocks, then your two improbable, extreme outcomes are: (1) much higher growth than what's occurred in the past or (2) negative, declining growth.

Value investors don't chase high growth, high multiple stocks which are particularly susceptible to savage rerates if earnings disappoint.

It is also misleading to write - off high multiple stocks as not being value opportunities — there are some businesses with growth rates and returns on incremental invested capital that can more than justify an optically high earnings multiple.

Stock prices plummeted beginning in 2000 as investors decided that times were not that different and they were no longer willing to accept the risk of owning high multiple stocks.

«High multiple stocks can become average multiple stocks at the drop of a penny in expected earnings.

She then looks at a company's return on invested capital; the higher the ROIC, she says, the higher multiple the stock deserves.

Not exact matches

Still, there is a temptation to abandon one's past investing style when higher P / E stocks outperform lower ones over multiple years, as they've done lately, Harper says.

«If you don't have the guts to be entirely in real estate, which I think is more in the eighth or ninth inning, I think stocks are still in the third or fourth inning, which nobody is talking about because I think multiples should be much, much higher,» Chase told CNBC PRO.

The highest valued stocks are now making the big moves — «highest valued» meaning the highest price - to - earnings, highest price - to - sales [multiples]-- so I'm begging you to do something for me: if you're going to own these stocks... please know what you're buying,» the «Mad Money» host said.

And they have the same goals as I have, which is to improve the efficiencies and profitability of Canaccord and take the stock to much higher multiples for internal and external shareholders.

(Media companies» stocks often trade at higher multiples than those of hardware companies.)

Another example, Macy's, which is popular with value investors for a high dividend combined with a low valuation multiples, also saw its worst single - day stock performance post earnings in over a decade, falling 14 percent.

The stock is trading at the high end of its historical range, but its «industry leading earnings and free cash flow growth» make up for that higher multiple, he said The stock is currently trading at $ 191 a share, but Hansen said it will hit $ 220 over the next 12 - months.

Client inquiries about the appropriate P / E multiple to assign US stocks routinely ignore that margins are extremely high on a historical basis and have been stagnant for several years.

Domestic - facing stocks have faster expected sales and earnings growth but trade at a nearly two point P / E multiple valuation discount relative to stocks with high international sales.

These funds offer diversification across multiple asset classes, including domestic and international stocks across varying styles and market capitalization ranges, investment grade and high yield fixed income, and short - term investments.

I do think there is some validity in the argument that stocks deserve a higher multiple today then they did at the turn of the 20th century.

The more corporate earnings grow, the higher the stock market if valuation multiples stay the same.

In other words, at a certain level higher bond yields create real competition for stocks, particularly dividend stocks, and put downward pressure on multiples.

Strong earnings growth, not multiple expansion, has been the key driver of the Japanese stock market, which last week rose to its highest level since 2007.

The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity and generally disappointing historical performance in the stock itself.»

Logically, by taking more risk — in paying up to own «growth» stocks at higher multiples than the market average — one should expect to achieve higher returns.

Notice that in 2000, valuation multiples were highest for the largest stocks and lowest for the smallest stocks.

«It grows earnings not so much by the brilliance of management or the diversity of their operations, as Welch and Immelt claim, but through the acquisition of companies (more than 100 companies in each of the last five years) using high - powered, high P / E multiple GE stock or cheap near Treasury Bill yielding commercial paper.

Another statistic courtesy of Mike Goldstein is that utility stocks, a high - yield group I call the most bond - like of all stocks, today sell for almost the same P / E multiple as the S&P 500.

As I note throughout the Undervalued Dividend Growth Stock of the Week series, a high - quality dividend growth stock that's undervalued can confer multiple benefits to the long - term investor: a higher yield, greater long - term total return prospects, and less Stock of the Week series, a high - quality dividend growth stock that's undervalued can confer multiple benefits to the long - term investor: a higher yield, greater long - term total return prospects, and less stock that's undervalued can confer multiple benefits to the long - term investor: a higher yield, greater long - term total return prospects, and less risk.

However, while the path of least resistance seems higher, with seasonal factors and solid economic data also favoring the bulls, stocks are clearly overbought and multiples are expanding.

In general, they are looking for companies growing at superior rates than the general marketplace, but are unwilling to pay the extremely high multiples associated with the hyper growth stocks.

As usual, I don't place too much emphasis on this sort of forecast, but to the extent that I make any comments at all about the outlook for 2006, the bottom line is this: 1) we can't rule out modest potential for stock appreciation, which would require the maintenance or expansion of already high price / peak earnings multiples; 2) we also should recognize an uncomfortably large potential for market losses, particularly given that the current bull market has now outlived the median and average bull, yet at higher valuations than most bulls have achieved, a flat yield curve with rising interest rate pressures, an extended period of internal divergence as measured by breadth and other market action, and complacency at best and excessive bullishness at worst, as measured by various sentiment indicators; 3) there is a moderate but still not compelling risk of an oncoming recession, which would become more of a factor if we observe a substantial widening of credit spreads and weakness in the ISM Purchasing Managers Index in the months ahead, and; 4) there remains substantial potential for U.S. dollar weakness coupled with «unexpectedly» persistent inflation pressures, particularly if we do observe economic weakness.

As a result, the stock's NTM EV / S multiple has expanded from 4.7 x two years ago to 8x, which creates a balanced risk - reward profile — even though it can likely sustain a high growth rate over the coming years, according to KeyBanc.

With stocks at currently high multiples on normalized earnings, that type of scenario would probably increase the odds off a deep recession and induce a much larger decline in stock prices.

Trading that occurs at low multiples of earnings, cash flow or book value for long periods of time might indicate that the company or the entire sector is in trouble, and that stock prices may not move higher.»

The S&P 500 registered a record high after an advancing half - cycle since 2009 that is historically long - in - the - tooth and already exceeds the valuation peaks set at every cyclical extreme in history but 2000 on the S&P 500 (across all stocks, current median price / earnings, price / revenue and enterprise value / EBITDA multiples already exceed the 2000 extreme).

SaaS stocks continue to move higher, and the EV / S multiples for the 55 biggest stocks stand at 7.2 x and are closing in on a five - year peak of 8.8 x, according to KeyBanc Capital Markets.

The S&P 500, Nasdaq, and the Dow have hit multiple record highs in recent weeks, and global stock markets in Asia, Europe, and elsewhere are very strong right now too.

The question for any investor given today's high stock multiples AND low bond yields globally is how much this matters not only over an intermediate time frame, but over a period potentially

Technology and financial stocks have led the stock indexes higher, pushing the Dow Jones industrial average to yet another record high, trading at a multiple of 19.9 to TTM earnings.

How far into the future must the company keep its high growth rate to bring the stock's price closer to the multiple on competitors?

Take 30 high - performing stocks in multiple sectors, do a little bit of math, and there you have it — a snapshot of the relative strength of the market.

But Wall Street got discouraged by multiple delays and controversies in the new administration, and investors turned toward high - growth technology stocks instead.

He recognized early on that applying leverage to safe, cheap, high - quality stocks would magnify returns without the risk of fire - sale, allowing him to stick to the principles outlined above over the course of multiple economic and market cycles.

Stocks like Boeing — up 112 % since the start of 2017 — are trading at some of their highest earnings multiples in some time, he notes, pointing at the chart below.

Accolade is still 20 per cent owned by New York Stock Exchange - listed Constellation Brands which bought the entire wine business for $ 1.9 billion in 2003 when it was known as BRL Hardy, and then sold down most of its stake in 2011 for a much lower multiple after a sustained slump in profits as the high Australian dollar hit profit margins on exports.

Fast forward six months, and the high - street has firmly taken note of the catwalk with brands stocking multiple designs based on the retro classic.

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These stocks often trade at very high PE multiples but once their balloon is pierced and the market starts to value them more like other companies, their stock price can come down in a hurry.

Trading that occurs at low multiples of earnings, cash flow or book value for long periods of time might indicate that the company or the entire sector is in trouble, and that stock prices may not move higher.»

Basically, this view suggests that in an inflationary environment in which a stock is trading at its intrinsic value and 100 % of earnings will be used to repurchase shares, there is no multiple too high.

Style 1: Growth Investing Growth stocks are companies which are consistently and predictably growing at supernormal rates and given the visibility in their earnings trajectory, the market keeps re-rating them to levels which look obscenely high when one looks at price - earnings multiple of trailing twelve months.