I'll post my part III on leverage later, but this interested me. Revenue growth for the last quarter was up, by 7.4%.
That should be a good thing, but here's the problem, earnings were down 2.5% from the same quarter last year. Effectively, business are 10% less efficient, or basically they are seeing their margins squeezed. Revenue up, earnings down is a squeeze and it results in the P/E trending upwards without the share prices increasing. If the share prices are going up, the P/E is going up even faster.
This is bad for investors and the market is ignoring it.