Home Forums Members Forum Concerning P/E as stock enters 3rd buydown… CAJ

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  • AvatarMark Monteleone
    Participant
    Post count: 4

    I was poised to do my 3rd buy down on CAJ, taking my total securites inventment divided by 20 positions, divided by 3. Before I went to pull the trigger on 3rd buyin for CAJ, I noticed that the P/E was almost 26. I was wondering if there is P/E where the buydown recommendations change or are paused. Thinking we are good, but thought this might be a point of clarity.

    Sean HymanSean Hyman
    Keymaster
    Post count: 3300

    It’s forward P/E is in the 14’s. https://finance.yahoo.com/quote/CAJ/key-statistics?p=CAJ

    It’s only its trailing P/E that was that high. So that means its P/E is improving.

    Also, the lower price you get in at also takes your blended dividend yield higher, in this low yielding world.

    AvatarMark Monteleone
    Participant
    Post count: 4

    Ok, an exercise in Investopedia… I’ll review those terms, got it. Good news.

    Figured so I pulled trigger. Only up from here right? lol

    Sean HymanSean Hyman
    Moderator
    Post count: 2761

    It’s fine to get your 3rd tranche in.

    Trailing P/E compares the present stock price to its past year of earnings. Forward P/E compares the stock price to its expected/anticipated earnings over its next 12 months.

    Sean HymanSean Hyman
    Moderator
    Post count: 2761

    It’s fine to get your 3rd tranche in.

    Trailing P/E compares the present stock price to its past year of earnings. Forward P/E compares the stock price to its expected/anticipated earnings over its next 12 months.

    AvatarDaren Brumley
    Participant
    Post count: 13

    I just entered my first tranche at $16.40. I entered the trade with trepidation since I feel like the market is about to turn bearish. Hopefully my thinking is correct that I can buy a second tranche if it falls another 10% or so, then third if it falls another 10%.

    Sean HymanSean Hyman
    Keymaster
    Post count: 3300

    A solid company that’s already beaten down a lot is a great place to start among a potential stock market downtrend, especially with its nice dividend yield. Few places could you get a 4.6% annual dividend yield.

    Getting a stock, way below its 200-week moving average shows its grossly oversold and the sentiment has gotten way too negative. You can see from the past what it tends to do over time. Here’s where I believe it could go over the next year or two. Lots of technical improvements lately.

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