42 Tips about Earnings

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There are managers who actively use GAAP to deceive and defraud. They know that many investors and creditors accept GAAP results as gospel. So these...
Be wary of companies whose quarterly earnings grow smoothly in a straight line. Businesses are rarely that consistent in reality, and it can be a sign...
Once you have determined an appropriate P/E ratio, you can multiply that ratio by a stock's past 12-month earnings to determine a rational current...
Earnings may not be the only important indicator of the current strength of a company but they certainly provide useful information to help in the...
I look for companies that may be losing a bit of money, break-even or even a bit negative cash flow, but where two to three years out you can get $1...
We look back as far as possible to inform what would be the worst-case levels of revenues and margins, and then apply what we think are trough...
If you look at long-term data, actual net earnings tend to be, on average, about 10% less than reported operating earnings. The difference is...
If you’re looking, as we are, for extraordinary returns – from companies whose stocks can go up 10x rather than 2x – it’s far more likely to...
The investor cannot pinpoint just how much per share a particular company will earn two years from now. As a matter of fact, the company's top...
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