[Event] How To Pick Quality Companies When It Is In The Dip?
Since the beginning of the year, the market has been continuously declining, with $S&P 500(.SPX)$ losing $5 trillion in value over 16 days. The price-to-earnings ratios of several star stocks have dropped to lower levels.
While $NVIDIA(NVDA)$ forward PE remains around 25, its PEG is only 0.81 (according to bloomberg estimates)
PEG is used to measure the reasonableness of a company's price-to-earnings ratio relative to its future earnings growth. Typically, a PEG close to or below 1 indicates that the company's stock price is relatively reasonable or undervalued. Nvidia's PEG is the only one below 1 among the MAG 7 companies, meaning the company is currently undervalued.
Additionally, ROE is a good indicator that Buffett uses (he suggests the average ROE must exceed 20% over the past ten years).
Check big tech’s key ratios after the drop!
From the above data,
considering the company's growth-adjusted PEG, $NVIDIA(NVDA)$ and $Alphabet(GOOG)$ perform the best;
in terms of forward PE, $Alphabet(GOOG)$ and $Meta Platforms, Inc.(META)$ have the lowest;
during this downturn, $Meta Platforms, Inc.(META)$ and $Netflix(NFLX)$ are the most resistant to declines;
the highest ROE is from $Apple(AAPL)$ and $NVIDIA(NVDA)$ .
However, after $Tesla Motors(TSLA)$’s 40% drop this year, its forward PE, PEG, and ROE are the worst among the MAG 7 companies.
Do you have any tips or indicators for selecting good companies during a market downturn?
Which quality company is your pick?
Leave your comments and also post to win tiger coins~~~
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🌟🌟🌟The Magnificent 7 recently had a tough time especially $NVIDIA Corp(NVDA)$
As a small investor with limited resources, I like to invest in $Roundhill Magnificent Seven ETF(MAGS)$
Even though MAGS is an actively managed ETF , its expense ratio is 0.29%. MAGS also pays dividends annually. The current dividend yield is .95%.
MAGS does the heavy lifting for me and offers me great value for my money. I believe that Magnificent 7 growth is by no means over and still tick all the core fundamentals of a quality stock.
@Tiger_comments @TigerClub @CaptainTiger @TigerStars
Since the beginning of the year, the market has been continuously declining, with $S&P 500(.SPX)$ losing $5 trillion in value over 16 days. The price-to-earnings ratios of several star stocks have dropped to lower levels.
While $NVIDIA(NVDA)$ forward PE remains around 25, its PEG is only 0.81 (according to bloomberg estimates)
Do you have any tips or indicators for selecting good companies during a market downturn?
Which quality company is your pick?
Leave your comments and also post to win tiger coins~~~
1️⃣ Strong Free Cash Flow (FCF) – A company that generates consistent cash flow can weather downturns without excessive debt or dilution.
2️⃣ Resilient Business Model – Companies with pricing power, high margins, and recurring revenue streams tend to perform better in uncertain markets.
3️⃣ Long-Term Secular Growth Trends – I invest in businesses positioned in high-growth industries, ensuring long-term demand remains strong.
My pick? $Alphabet(GOOGL)$ . While tech stocks have taken a hit, Alphabet remains a cash-printing machine with dominant businesses in search, AI, and cloud. With one of the lowest forward PEs among big tech and steady revenue streams, it’s a classic example of a stock I’d want to own for the next decade.
@Tiger_comments @TigerStars @TigerGPT
Beneath the effervescence of its brand lies a robust economic moat, decades of consumer loyalty, global distribution hegemony, and consistent cash flows that fizz with resilience.
While speculative bubbles inflate and burst, $KO’s valuation, often tethered to tangible fundamentals rather than fleeting hype, offers a refreshing sip of stability.
Like the iconic beverage itself, it’s not just a momentary delight but a dependable staple, a true rarity in a market intoxicated by artificial sweeteners of growth at any cost. 🥤🥤Happy trading ahead! Cheers BC 💰📈🚀🍀🍀🍀
1. 估值是否合理：市盈率（PE）只是參考，PEG（市盈率相對盈利增長比率）往往更具指導性。例如，英偉達的PEG僅0.73，意味着其增長速度遠超估值提升的幅度，仍具吸引力。此外，對於尚未盈利的成長型公司，市銷率（PS）或市淨率（PB）可能更適用。
2. 盈利能力與增長：關注ROE（淨資產收益率）和ROA（資產回報率）。一個優質公司，即便在逆風期，ROE和ROA通常能維持較高水平，說明它的資本使用效率高，具備長期競爭力。
3. 現金流與財務健康：市場低迷時，現金流比利潤更重要。自由現金流（FCF）充裕的公司在經濟下行時更有韌性。此外，低負債率、充足的流動資金也是關鍵。
4. 行業趨勢與護城河：選擇那些在行業週期中具備領先地位，並擁有核心競爭力（如技術壁壘、品牌價值、市場份額）的公司。例如，AI、半導體、高端製造等長期賽道中的龍頭公司。
總的來說，逢低佈局優質公司，關鍵是尋找具備增長潛力、財務穩健、估值合理的標的，而不是單純看便宜的股票。市場情緒短期可能會影響股價，但長期價值終會迴歸。