I've heard "PEG" (P/E to growth) used as a metric. Tesla has an annual 50% earnings growth, so P/E 200 / 50 = PEG of 4 Toyota P/E of 13 w 2% growth = PEG of 6 so... not wildly disparate !https://twitter.com/StephenFleming/status/1300799942995320832 …
-
-
Replying to @MorlockP
This implies those growth rates continue into perpetuity, which is where it breaks down.
1 reply 0 retweets 1 like -
-
Replying to @MorlockP
The present value of a cash flow stream is based on the risk adjusted rate of return and growth, PV = CF /(r - g)
2 replies 0 retweets 0 likes -
It’s the Gordon Growth Model.
1 reply 0 retweets 0 likes -
PEG is obviously better than PE, but one year earnings growth shouldn’t be used.
1 reply 0 retweets 0 likes
Replying to @ztnra
you've now moved the goal posts from "This implies those growth rates continue into perpetuity"
7:34 AM - 1 Sep 2020
0 replies
0 retweets
0 likes
Loading seems to be taking a while.
Twitter may be over capacity or experiencing a momentary hiccup. Try again or visit Twitter Status for more information.