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To: Starboard

get out PE's, div-yields, etc

The quality of earnings concerns me. As is generally known, many companies are buying back shares with borrowed money

Virtually all corporations raise capital with some combination of share sales and borrowing, which is why investors also look at say, debt/equity ratios or return on equity when evaluating an investment.  The point is to go past 'quality' and get into 'quantity', in order to calculation how much or how little to invest.

There's a lot of negativism around, but when folks say the metrics are bearish I still get nowhere when it comes to actually getting to see those metrics to compare w/ times past when markets later proved to be failing.

11 posted on 03/15/2015 10:50:06 AM PDT by expat_panama
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To: expat_panama

Virtually all corporations raise capital with some combination of share sales and borrowing

**************
True but in this case we’re not talking about raising money for capital expenditures or other business needs. It’s about taking on debt solely to buy back shares. I prefer to see real, organic growth instead. Just my view.

To your other point, fundamentals don’t seem to matter much anymore. This is a fed-driven market and that printing party seems to be coming to its inevitable end. That concerns me. IMO there is a lot of downside risk right now.


16 posted on 03/15/2015 12:03:15 PM PDT by Starboard
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