Two Year Projected PE Calculator

The past 40 years reveal that winning stocks start off highly priced compared to the rest of the market and get even more expensive. Most winners expand their PE by 120% during their run. These stocks have a tendency of being cutting edge leaders with remarkable earnings and sales growth. Investor's Business Daily's IBD SmartSelect™ Corporate Ratings tracks vital statistics such as EPS, (Earnings Per Share) and SMR, (Sales+Profit Margin+Return on Equity). Although there are several important figures one can use when analyzing stocks, EPS and SMR are most beneficial when used to find a winning stock within the Two Year Projected Price Earnings Forecasting Calculator below. I believe a stock with an EPS rating of 93 or higher and an SMR of A would be characterized as a winning stock.

An EPS rating of 93 or higher means that a stock has outperformed 93% of all publicly traded companies in earnings. The EPS rating combines each company's most recent two quarters of earnings per share growth with its 3 to 5 year annual growth. First, the two most recent quarters' one year ago (short term). Then the company's annual earnings growth rate for the past 5, 4 or 3 years depending on history available (long term) and stability of long term earnings.

An SMR rating of A would equal the top 20% of sales, margins and return on equity. Four important fundamental factors are used when determining SMR. A company's sales growth rate over the last 3 quarters, before- and after-tax profit margins, and return on equity. Sales growth and after-tax margins are computed using quarterly figures, and return on equity and pre-tax margins is annual. All four factors take into account acceleration (rate of return).

Enter data into the blue fields below:

Current Stock Price:
Past 12 Months EPS (Actual):
Earnings Estimate for Annual Growth Rate Over the Next Two Years (%):
Current PE:
Next Year EPS (FY):
Two Year EPS (FY):
Two Year Target Price:

The information on this page, although taken from sources believed to be reliable, does not constitute investment advice and is not guaranteed by Blue Chip Pick as to its accuracy or completeness, nor any trading result, and is intended for purposes of information and education only.

To Top
Federal Funds Pit
Federal Funds Pit
History of Federal Funds Rate changes
LIBOR - OIS (November 11, 2008)
LIBOR is down to 2.18% a 4-year low. It reached a high of 4.81% on 10/10/08 when equities found new 52 week lows. It was about 2.81% the day Lehman filed for bankruptcy on 9/15/08. LIBOR-OIS spread may be a worry. It has fallen to 168 basis points, which compares to 87 basis points on the last trading day before Lehman declared bankruptcy, but has averaged 11 basis points in the five years before the recent financial crisis. In the last five years before January we had just completed a 4 1/2 year bull market (03-07). Alan Greenspan stated recently that the LIBOR-OIS spread should serve as a measure for determining when markets have returned to normal. 168 basis points does not seem normal to me.
FED FUNDS FUTURES (November 8, 2008)
Based upon the 30-Day Federal Funds futures contract for the December 2008 expiration is yielding an implied rate of .47% and currently pricing in a 100% chance that the FOMC will decrease the target rate by 50 basis points to .50% on 12/16/2008. The gap change between Long Term Treasury yields and the Fed Fund Rate can indicate growth direction. The gap increasing between the two rates may indicate slower growth may be near.
FED FUNDS FUTURES (October 31, 2008)
Based upon the 30-Day Federal Funds futures contract for the December 2008 expiration is yielding an implied rate of .64% and currently pricing in a 100% chance that the FOMC will decrease the target rate by 25 basis points to .75%, and a 44% chance of a 50 bps cut to .50% on 12/19/2008. The gap change between Long Term Treasury yields and the Fed Fund Rate can indicate growth direction. The gap increasing between the two rates may indicate slower growth may be near.
 

Created by
DMC Insights, Inc.

  

Copyright © 1996, 1993, 1990 by Charlie Pesiridis. All rights reserved.
Reproduction and/or redistribution of material from any BlueChipPick.com pages without written permission is strictly prohibited.
Blue Chip Pick ® is a trademark owned by Charlie Pesiridis.