A Simple Reason Equity Markets Won't Recover Anytime Soon

[Landis82]

Quote from sobemark:

i thought stock turder said 'earnings don't matter'

all kidding aside... sp500 earnings projections for 2009 were at $40 in january... i think they have been ratcheted down to $34

puts sp fair value at 500-520 IMO (that's with a 15 multiple)... and most bear markets end with crazy low p/e's

just food for thought

Bottom-up consensus estimates for the S&P in 2009 were at $65.12 at the end of January and is obviously a pipe-dream.

If the rate of earnings decline were to slow to 1.0% per week for the rest of the year, that would mean that earnings for the year would be only $41.01.

That would imply a P/E of 18.2 at current S&P levels of 750.

 

[gnome]

Quote from fearless9:

Any idea what the projected tax revenues will be.


regards
f9

Don't know. Could be that the revenue impact might not be all that much. Many of those who have become unemployed were not paying much tax anyway... though will have shifted from the "tax paying [if small] to unemployment benefit receiving" group... a greater cost to the social support system.

 

[sobemark]

Quote from Landis82:

Bottom-up consensus estimates for the S&P in 2009 were at $65.12 at the end of January and is obviously a pipe-dream.

If the rate of earnings decline were to slow to 1.0% per week for the rest of the year, that would mean that earnings for the year would be only $41.01.

That would imply a P/E of 18.2 at current S&P levels of 750.

even if they were at 41.01 ..which i have heard lower ...

does the sp justify a p/e of 18.2 ??!! i don't think so .

 

[ElCubano]

Quote from fearless9:

EARNINGS ....

"we tawkin' bout ernin's. Cmon it just be ernin's"...The Answer

 

[libertad]

f9

Will be much lower than this.....


http://money.cnn.com/2009/01/07/new...dget_outlook/index.htm?postversion=2009010717

 

[sobemark]

Quote from Landis82:

Bottom-up consensus estimates for the S&P in 2009 were at $65.12 at the end of January and is obviously a pipe-dream.

If the rate of earnings decline were to slow to 1.0% per week for the rest of the year, that would mean that earnings for the year would be only $41.01.

That would imply a P/E of 18.2 at current S&P levels of 750.

http://www2.standardandpoors.com/spf/xls/index/SP500EPSEST.XLS

i usually calculate by GAAP ..

 

[Landis82]

Quote from sobemark:

http://www2.standardandpoors.com/spf/xls/index/SP500EPSEST.XLS

i usually calculate by GAAP ..

Understood.
Thanks!

 

[fearless9]

Quote from libertad:

f9

Will be much lower than this.....


http://money.cnn.com/2009/01/07/new...dget_outlook/index.htm?postversion=2009010717

Gracias.

I see that report was dated jan 7, '09 and suggested a 6.6% falloff in tax revenue.

Seems wildly optimistic to me.
I have an amigo who is a dentist in LA and his revenues are off 40% y on y so far and falling.

regards
f9

 

[libertad]

f9,

Wildly optimistic will be "an understatement"....

About as reliable as official employment numbers....

You know the rest of the story....

There just seems to be a continual problem of getting people in the right places that can get ahead of the curve....

"Being ahead of the curve" is a real problem....

 

[stock_trad3r]

n00b

all bad news priced in

if anything, the markets will likely surge 400 points today and end the week up 15%? maybe

people are shorting in droves in anticipation of more downside in equities and a 'global depression' that will never materialize.