How to Pick Stocks In a Bearish Market

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4 thoughts on “How to Pick Stocks In a Bearish Market

  • Firstly congratulations on your successful honeymoon. Another insightful and thought-provoking article. Based on this bearish market. What are your adjusted Intrinsic value calculation for CCNN and BETAGLASS based on the FGN 10-year bond?

    • Hi Tochi, the EPS to use for this estimate is the forward-looking EPS which is based on intuition, I use a modest growth of 10-15% EPS growth, and then compare with 13-14% FGN 10-year yield. As the company release half-year result, you adjust your EPS forecast to reflect realities, until you have a better grasp. There isn’t one way final EPS to use.

    • 2017 EPS for BETAGLASS is 8.23, a forecasted modest EPS growth of 15% is 9.46, using a bond yield of 13% + premium rate – 14% to estimate the share price, BETA GLASS has an estimated share price of N67, compared to N83 market price, the stock is currently overvalued. Technically, the price is already overbought on the monthly chart, that doesn’t mean price may not go up (a forward PE of 8.77 is undervalued on a long-term) but short-term reversal to me is very close.

      • Wow a true eye-opener, I just learned something new that even if a stock is over valued it could still go up. But I plan to stick to my strategy of looking for under valued stocks with good growth potential. Thanks Mr. Oge. Keep up the amazing work☺

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