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Good (Bad) Banks and Good (Bad) Investments: At the right price.

Musings on Markets

Consequently, you can only value the equity in a bank, and by extension, the only pricing multiples you can use to price banks are equity multiples (PE, Price to Book etc.).

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A Follow up on Inflation: The Disparate Effects on Company Values!

Musings on Markets

Historical Data: 1930-2019 To see how this framework works in practice, let's start by looking at the performance of US stocks, across the decades, and look at the returns on stocks, broadly categorized based on market capitalization and price to book ratios.

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Market Resilience or Investors In Denial? A Mid-year Assessment for 2023!

Musings on Markets

trillion in the first six months of 2023, 97.2% trillion increase in value for all US equities. Looking at value and growth go back and forth between the winning and losing columns in 2023, I believe that this is a pattern that will continue to play out for the rest of the decade, with no decisive winner.

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Data Update 3: Inflation and its Ripple Effects!

Musings on Markets

I also looked at how inflation plays out on equity sub-groupings, on two dimensions, the first being market capitalization and the second being price to book, with the former becoming a stand-in for the vaunted small cap premium and the latter for the value versus growth question.

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The Importance of (and challenges with) Valuing Intangibles

IVSC

Searching for stocks with low price-to-book ratios was a good indication of a potential bargain. This makes the task of valuation much more difficult, but also a lot more interesting. In the past, market valuations often mirrored the reported balance sheet.

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Data Update 1 for 2023: Setting the table!

Musings on Markets

I also report on pricing statistics, again broken down by industry grouping, with equity (PE, Price to Book, Price to Sales) and enterprise value (EV/EBIT, EV/EBITDA, EV/Sales, EV/Invested Capital) multiples. Standard deviation in stock price 2. Price to Book 3. High-Low Price Risk Measure 5.

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Interest Rates, Earning Growth and Equity Value: Investment Implications

Musings on Markets

Interest Rates and Value As interest rates have risen, the discussion in markets has turned ito the effects that these rates will have on stock prices.

Equity 52