Screening For Misvalued Stocks by Martti Luoma and Reijo Ruuhela
ARTICLE SYNOPSIS ...Valuing A Stock Using Earnback Periods
by Martti Luoma and Reijo Ruuhela
You won't get an edge on finding good trades using
the same tools everyone uses. Here's a new look at
finding misvalued stocks.
he price/earnings ratio (P/E) is
undoubtedly the most common
valuation measure of a stock, and
also the most commonly misused.
P/E combines outside information
(price) and inside information
(earnings). Because of the central roles that price
and earnings play, it is not particularly surprising
that the use of P/E is so popular among analysts