Corporate earnings are also referred to as “company 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.
The NASDAQ opened higher on Thursday, July 16th, as investors cheered a Greek bailout approval and strong corporate earnings. European stocks climbed and bond yields fell on Thursday after the Greek’s parliament approved a proposed bailout plan. Eurozone stocks rose 1.5% to 3,676 points and Germany’s DAX rose 1.6% to 11,722 points.. Read More
A significant number of companies on the U.S. stock market continue to “engineer” their corporate earnings with stock buyback programs. Sadly, investors have become too complacent with this and remain overly optimistic. Beware! This is dangerous.Earnings Now Outright Misleading at Very BestI know I am one of the only few talking. Read More
Investors were jumping into stock buying on Thursday morning. But while it may be an encouraging sign for the stock market, my advice is not to be fooled by this dead cat bounce.We will likely see oversold buying after bouts of deep selling (as we have been witnessing). I doubt there are sustainable market gains around the corner; unless. Read More
While the mainstream media is quick to blame the woes of North American stock markets on the crisis in Greece and the collapsing Chinese stock market, the fact is that American stocks were in a rout long before this.I’m not tooting my own horn; but I’m sure you saw the video I produced late last year titled, “The Great Stock Market Crash. Read More
The stock market’s second quarter is over and reporting is lackluster at best. While it’s in the very early days, so far the numbers are mostly coming in soft—disappointing on at least one financial metric.What we’re also seeing is confirmation of existing full-year outlooks and good expectations for 2016. The stock market. Read More