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May 2014



Multiple In, Multiple Out

May 08, 2014 – Comments (4)

I’m currently reading Howard Marks’ book, The Most Important Thing Illuminated. The book seems pretty good (so far), and I’ve really enjoyed the periodic commentary from other successful investors, including Greenblatt and Klarman.    [more]



“The p/e ratio of any company that’s fairly priced will equal its growth rate”

May 01, 2014 – Comments (19) | RELATED TICKERS: PNRA.DL

This line comes out of Peter Lynch's famous book One Up Wall St.  It is the essential premise for using his PEG ratio, which divides the long-term EPS growth rate of a company by its P/E ratio.  If a company is trading at a PEG of 1.0, it's fairly valued.  If it's trading at a PEG of less than greater than or less than 1.0, it's respectively over- or under-valued.  [more]

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