AAII says price/earnings is computed “by dividing the current
stock price by earnings per share for the most recent 12 months. It is followed
so closely because it relates the market’s expectation of future company
performance….”
The P/E Relative Screen stock-selection strategy followed at
AAII (one of 77 followed by AAII)
was up double digits in the last 10, 5, and 3 years, as well as YTD 2013 to
April 30.
Of the 24 stocks passing the strategy’s criteria, YHOO is
rated the highest for relative valuation/price.
My five-year performance chart for YHOO shows a scary amount of
sideways up-and-down action since the market lows of 2009 but a sharp trend upward since the latter
part of 2012.
My three-month chart suggests a slowing upward trend and
thus a stock worth holding or watching but perhaps not yet a stock worth buying.
Well, that's just my opinion. Yahoo's consensus of analysts: a strong buy.
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