2020 has been a crazy year for the stock market with many companies going bankrupt. Well, the fangs, Facebook, Amazon, Apple, Netflix, and Google, all rising and value. Becoming very costly. You might be asking what makes the Fang stocks so POS and what is the key ratio? The PE ratio is the price to earnings ratio is the current stock offer cost divided by the profit per share.
For example, if company ABC. Has 1 million portions of stock currently priced at $20 and offering and offer earn $9 income or $2 per share. And the PE ratio would be $20. But if I can dollars, which gives a ratio of 10. Another way of looking at this example would be how long would it take to make money back?
If you purchase all the portions $20 million, assuming the company consistently earns $2 million per year, it would take 10 years to recoup your investment, which is a long term ROI of 7.2% per year. Not bad. At all, but what’s an acceptable
it’s the typical benchmark of a good PE ratio, but it depends on the industry. It’s difficult to compare tech companies like Apple with a retail company, like Costco. The lower the PE ratio, the less expensive stock and vice versa.
Currently the high work of stocks does not correlate the Dow, which is presently at around a P ratio of 29. And over. Nearly double the historic average of 15, which is why I don’t think this stock at the time of this video, the tank ratios are 34, 100 1934, 85, 34. Obvious that the stocks are overvalued and investors are seeking alternative investments.
Like gold, which doesn’t cash flow. And as pit all time highs after the big recession, it crashed to an all time low, shortly sophisticated investors should look into recession resistant investments. Cashflow stabilize apartment buildings with some value, add opportunities. Talk to, so we’re looking at, but strong, existing cashflow already in place. All time, low interest rate now is the time to take on good. Get ready for inflation because it’s comfortable.
How else are you? April? My stock portfolio can be compared to a person with an injection in suddenly struck in weekend.
My multifamily portfolio, access of vaccine, keeping my overall net worth intact, helping we stay afloat during downturns.
Over my 4,200 unit portfolio. We’re still well above 90, 95% of collections through this epidemic. When the government prohibited ports from evicting tenants, there weren’t no noticeable changes in rents and collections coming in.
The steady in my portfolio may have been because after all people need a place to live and they need good value base places to live between the $700 to $1,200. At the end, it comes down to supply and demand. This country needs more value-based options for regular people.
But speculating in the stock market and investing in real assets.