Why These Are Such Hard Times For Investors
In the forty years that I have been studying and participating in investment markets, the current conditions are among the most challenging. That may sound odd - interest rates... Read More
Company Information Releases And Stock Prices
I don’t often disagree with Warren Buffett, but his position on companies providing guidance was one example. In a previous post, I argued that the more information companies give... Read More
Investment Risk And Stock Prices
Academics and practitioners alike recognize that increase in the perceived risk of equity investing, and the associated increase in the risk premium, can cause stock prices to fall. Most... Read More
What Do Auto Price Earnings Ratios Tell Us?
On October 24, 2018 Tesla announced its best quarter ever. Sales rose to $6.8 billion from $4 billion the previous quarter. Gross margin improved to 22.33% from 15.46% in... Read More
Bubble Stocks Update – 25% Downturn In Just A Few Weeks
With all the turmoil in the markets, I felt it was time to take a look back at the ten bubble stocks from my post after the close on... Read More
What Are Bear Markets?
With stock prices down sharply last week the words “bear market” and “correction” have once again been bandied about. In response, I first offer the standard definition of both... Read More
Production Hell, Delivery Hell, What The Hell Is Next For Tesla?
Service hell. Though it might be more hell for owners than for Tesla. Tesla reported a 3rd quarter profit ather the market closed today and the stock has sky-rocketed... Read More
Where Are All Tesla’s Competitors
In numerous posts on this blog, I have argued that the stock of Tesla has been overvalued. That remains true, though less so in my opinion, today. I say... Read More
What You Don’t Know About Stock Market Performance Can Hurt You
A worrisome fact is how little many Americans know about stock market returns and historical performance. That ignorance limits the extent to which they participate in the long-run benefits... Read More
Looking For Value? Consider General Motors – No Really!
Critics of this blog point out that almost all the valuations we have posted here reach the same conclusion – the securities in question are overpriced. The most recent... Read More
Bubble Stocks: That Was Fast!
Someone once said if you make a forecast and it turns out to be right, don’t let anyone forget it. In the last couple of weeks Cornell Capital Group... Read More
Bubble Stocks: What Goes Up Might Come Way Down
Several months ago, Rob Arnott, Shane Sheppard and I wrote an article entitled, Yes, It’s a bubble. So what? In that piece, we argued that many stocks were approaching... Read More
Public Equity Investment Strategies
At the Cornell Capital group we put investment strategies into three general buckets. The first bucket is easy – accept market efficiency as a working hypothesis and buy highly... Read More
Fundamental Investing Is Harrowing: Here’s Why
As usual, I find it helpful to work with an example. The example used here is Apple because it is a relatively easy company to value. On September 21,... Read More
Conceptual Foundations Of Investing
Our new book comes out next week. It will be on Amazon. It is targeted more to serious amatuer investors as opposed to professional money managers or finance scholars. ... Read More
Pay For Performance In Money Management
On September 21, 2018, the Wall Street Journal ran an article entitled “Fund to Cut Pay for Market Laggards.” The articles described how Peter Kraus, the ex-CEO of successful... Read More
Intangible Capital And Growth Options: The New Source Of Value
When analyzing a company’s financial performance there are three things that need to be disentangled: (1) the difference between book and market values, (2) the difference between tangible capital... Read More
An Eye On Measuring Profitability
Assessing profitability lies at the core of valuation and investment analysis, but it is far from straightforward. The most widely reported measure is profitability is return on equity, or... Read More
High Expectations Can Bring Big Risks
The total market value of a company can be divided into two parts: the fraction of due to current and short-run foreseeable operations and everything else. Financial economists have... Read More
Musk Made the Right Call to Abandon Going Private
On Friday night at 8 pm, well after the market had closed, Mr. Musk disclosed that he was abandoning his effort to take Tesla private. For those who read... Read More
Information And Stock Price Movements The Case Of Tesla
Tesla attracted such attention with its back to back earnings announcement and the Musk tweet that we wrote a short research paper analyzing the two news releases. Get The Timeless... Read More
Beware The 10-Year Real Interest Rate
With regard to valuing companies, the 10-year real interest rate plays a key role. It is foundation on which discounts rates are built and the higher those discounts rates,... Read More
