Archives: 2008 January
Valuation – some more thoughts
January 28th, 2008, 3 Comments
I covered my approach to estimating the appropriate PE for a stock and reverse engineering the current valuations in the previous posts. This is ofcourse not the approach taken by analysts. The typical approach is to look at the past history and decide on the likely earnings (and not even free cash flow). If the [...]
Valuation – reverse engineering the stock price
January 23rd, 2008, 4 Comments
I discussed my approach on evaluating PE ratios (see here). In addition based on the table shown in the previous post, we can work out the assumptions built into the stock price in terms of the ROC, CAP and growth rates. These variables can be compared with the actual and expected results of the company [...]
Valuation – How to evaluate the PE ratio
January 17th, 2008, 12 Comments
I had done a quick valuation exercise of MRO-TEK earlier (see here). I used a certain PE ratio in the post and said that I would explain my approach later. So here it goes … To understand my approach, you have to look at the file Quantitative calculation and worksheets – cap analysis and ROC [...]
The black swan – unpredictability, futility of forecasting etc
January 10th, 2008, 6 Comments
I have just finished this book. I wrote about this book earlier here. I have also read N N Taleb’s earlier book – fooled by randomness and liked it a lot. I will not be doing a detailed review of the book as that can be found on amazon and a lot of other website. [...]
HPCL – a quick review
January 5th, 2008, No Comments
I had written about HPCL earlier (see here). To recap, my main thesis was as follows. HPCL now sells at around 9000 crores. The EV is around 10000-11000 crores at best. The replacement value of the assets is around 25000-30000 crs. The company is selling at 25-30% of replacement value, which can reduce due to [...]
Reading the Book – The Black swan
January 1st, 2008, 3 Comments
I am currently reading the book – The Black swan by N N Taleb. This is a great book on low probability, high impact events which are termed as black swans. I am still in the middle of this book. One key point which I came across is ‘confirmation bias’ on which the author has [...]
