They are also referred to as “corporate earnings” and “corporate profits:” basically, the amount of money a company makes in certain period of time. The price/earnings multiple is still the most common tool used to value a company. The stock market values a company based on the amount of money—the earnings and profits—the company has after all expenses, including taxes, have been paid. In a stock market where stocks are traded at an average of 12 times earnings, a company making $1.00 a share per year would be valued at $12.00. All things being equal, the more money a public company makes, the higher its stock price.
Looking ahead to 2015, the first and most obvious news the marketplace will be looking for is fourth-quarter earnings.
Even before oil prices experienced their material sell-off, fourth-quarter earnings were looking good, as corporate reporting in both the second and third quarters of 2014 estimated a solid finish to the year.
No… Read More
Earnings season continues and the deluge of results is positively affecting the S&P 500, which is pushing new record highs.
Also continuing its positive upward trend are biotechnology stocks, which still harbor a lot of price momentum from institutional investors.
Ligand Pharmaceuticals Incorporated (LGND) has been very h… Read More
There is a huge amount of news for the stock market to digest this week, with both economic data and company earnings reports. The stock market has been unsure of itself the last couple of weeks, wondering if the rally off of the Federal Reserve’s third round of quantitative easing (QE3) was a fake out. Now, the market needs company ear… Read More
Research In Motion Limited (NASDAQ/RIMM), otherwise known as RIM, is begging for patience from its shareholders and analysts…and that’s an understatement!
The stock price is down 95% over the last four years after trading at over $140.00 in May 2008, so my stock analysis is indicating that lots of patience is required, which co… Read More
The first quarter was great for stocks. April on the other hand has not been kind to stocks so far, but it’s early. The question is: are stocks pausing and then moving higher or lower?
Is this a sucker’s rally?
The bull market is into its fourth year and my market view is that the near-term technical picture shows tough chart resistanc… Read More