$MBLY Valuation and Momentum Indicators
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- May, 19, 2016
- Sundeep Bajikar
- 4SAFEt, Self-Driving Car, Stock Analysis
The chart below suggests that over its limited history (~couple of years) as a public company, Mobileye (NYSE: MBLY) stock price has not appreciated significantly even though NTM EPS estimate forecasts have been on an upward trajectory, indicating solid growth fundamentals. I think there are two potential explanations for the stock price action: 1) the […]
Read More$NVDA Priced for Perfection?
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- May, 19, 2016
- Sundeep Bajikar
- 4SAFEt, Self-Driving Car, Stock Analysis
The chart below compares NVDA stock price performance with NTM EPS forecasts over the last 10 years. After tracking EPS forecasts closely until mid-2010, NVDA stock underperformed EPS forecasts until recently. The chart suggests NVDA stock is finally caught up with EPS forecasts, which have generally moved higher over the last ~5 years, as gaming, […]
Read MoreWarren Buffet and Charlie Munger Quotes from 2016 Berkshire Hathaway Shareholder Meeting
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- May, 13, 2016
- Sundeep Bajikar
- 4SAFEt, Equity Research Process
“Running a public company you do waste time on certain things … like explaining quarterly earnings to analysts” “decided fairly early in life that my favorite employer was myself …” “(Shift from push marketing to pull marketing) is huge … hugely powerful trend” “In the end business in this country has done remarkably well […]
Read More$IBM Valuation and Momentum Indicators
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- May, 12, 2016
- Sundeep Bajikar
- 4SAFEt, Equity Research Process, Stock Analysis
The chart below suggests that over the last 10 years, IBM’s stock price has tracked NTM EPS estimates with occasional periods of divergence. Over the last few years IBM’s stock price tracked below NTM EPS estimates, as IBM’s P/E valuation multiple compressed. The chart below suggests that over the last 10 years, IBM’s […]
Read More4SAFEt – 4 factors drive margin of SAFEty in tech stocks
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- May, 11, 2016
- Sundeep Bajikar
- 4SAFEt, Equity Research Process
This chart taken from my book, illustrates my equity research framework comprised of 4 factors that drive margin of SAFEty for an investment in a tech stock. I learnt the concept of “Margin of Safety” in Benjamin Graham’s famous book “Intelligent Investor”, and modified Graham’s original process to come up with the 4SAFEt framework for […]
Read MoreDRAM: Select 1Q16 Comments from Samsung and SK hynix
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- May, 09, 2016
- Sundeep Bajikar
- DRAM, Industry Analysis, Stock Analysis
Samsung and SK hynix’s commentary suggests both are expecting improvement in DRAM supply/demand balance later in 2016. Samsung “Currently, as you mentioned, the NAND market outlook is very strong. Actually, our outlook towards the DRAM market is not that bad either. And our production plan going forward as well as our inventory will be managed […]
Read More$AAPL: The Disappointment in 2 Charts
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- May, 05, 2016
- Sundeep Bajikar
- 4SAFEt, Stock Analysis
The chart below suggests that AAPL stock’s recent negative reaction to estimate cuts is similar to its behavior following product/earnings disappointments in 2013. The chart below suggests that AAPL stock’s recent negative reaction to estimate cuts included a compression of its NTM P/E multiple, similar to its behavior following product/earnings disappointments in 2013. The two […]
Read MoreHow Long Does it Take to do Equity Research?
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- May, 03, 2016
- Sundeep Bajikar
- 4SAFEt, Equity Research Process
The table below should give you some idea of the time it takes to execute different research activities required to analyze a given company. Depending on the size of the company, the complexity of its operational history, competitive and supply chain dynamics within the industry, and ease of access to information, it could take more […]
Read MoreWhy Market Participants are tempted to go “Research Lite”
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- May, 03, 2016
- Sundeep Bajikar
- 4SAFEt, Equity Research Process
Equity Research is very time consuming, and in the case of sectors like Tech and Pharma, also requires industry knowledge, which most investment professionals do not possess. Lack of process discipline and short-term performance pressure further compound lack of knowledge into a bigger investment problem. The end result is a collection of investment managers who […]
Read MoreValue vs. Growth – Unfortunate Mutual Fund Taxonomy
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- May, 03, 2016
- Sundeep Bajikar
- Financial Services
As the chart illustrates, confusing institutional nomenclature notwithstanding, value investing does not exclude growth stocks within my framework. When Benjamin Graham first introduced value investing, his focus was on estimating liquidation value of assets underlying a stock or a bond, with less importance placed on product or industry-specific dynamics as a source of potential future […]
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