tag:blogger.com,1999:blog-7294165939647321702.post3950890143436554683..comments2024-03-28T13:45:43.362-04:00Comments on <center><a href="http://www.barelkarsan.com">Barel Karsan - Value Investing</a></center>: More PE10 ShortcomingsSaj Karsanhttp://www.blogger.com/profile/04493152766022812984noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-7294165939647321702.post-77926469255602577082012-01-30T16:26:40.842-05:002012-01-30T16:26:40.842-05:00Hi obtuse,
You make a good point. I agree that ca...Hi obtuse,<br /><br />You make a good point. I agree that capital raises would mitigate buybacks.<br /><br />But buybacks (of a massive size and scope) are relatively new (last 2-3 decades or so) whereas I have no reason to suspect the pattern of capital raises has similarly increased dramatically. Maybe it has, I don't know.Saj Karsanhttps://www.blogger.com/profile/04493152766022812984noreply@blogger.comtag:blogger.com,1999:blog-7294165939647321702.post-33976932038736466242012-01-27T13:15:06.764-05:002012-01-27T13:15:06.764-05:00Good post-- One the flip side to the share buyback...Good post-- One the flip side to the share buybacks argument, stockholder dilution (through new equity or options based compensation) are an ongoing phenomenon too. In fact, it is hard to get solid data on this for all of the S&P 500.<br /><br />I'd guess that this capital erosion is balanced (albeit, not exactly) with the share buybacks. Wouldn't these countervailing forces just cancel each other out-- leaving PE10 to be closer to the real number?<br /><br />I totally agree that PE10 is just a rough guide to the market valuation and shouldn't be solely used to make actual buy/sell decisions.the_obtuse_investorhttps://www.blogger.com/profile/04882450560686626871noreply@blogger.com