r81984
Fair and Balanced
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join:2001-11-14
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| reply to lev
Re: Our new "customer retention plan".....
said by lev  :Also, stock price reflects investors' belief in value based on performance. HA
Stock price has nothing to do with a company's value, performance, or anything realistic.
Stock prices are just numbers made up to gamble with.
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Corehhi
join:2002-01-28
Bluffton, SC
| said by r81984 :said by lev :Also, stock price reflects investors' belief in value based on performance. HA Stock price has nothing to do with a company's value, performance, or anything realistic. Stock prices are just numbers made up to gamble with. No not made up numbers. A true base is P/E. Simple way to think of it is how much would you pay for the company? Would you buy a company thats profit the next year would pay off what you paid for the company? Yes you would. Next question is how many years would it take to pay off your orginal investment? 10 years sound reasonable? 15? 20? A high P/E ratio is used for companies that are growing profits because they will pay off quicker then a company that has flat profits. Flat profits will get you a lower P/E than a growth copmpany.
There are other things involved but the numbers aren't made up. |
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r81984
Fair and Balanced
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join:2001-11-14
St John'S, NL
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| Nope they are based on nothing more than what someone is willing to pay to gamble with.
Why do you think all the stocks crashed, no one wants to buy stock so the price tanks.
Basically you can say it based on demand of stock buyers, but really I say its just what gamblers are willing to pay in a russian roulette. Everyone pays more than the last guy until someone does not want to pay a higher price and that guy gets screwed. The price goes down, that guy looses money and it starts all over again.
The stock market is no different than going to Vegas.
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