11-18-2013, 09:34 PM
(11-18-2013, 01:33 PM)TomK Wrote: I guess it is another reason to only buy when you are sure you're getting a good value price. Like you're discussing in your "margin of safety" thread, if you are getting a stock undervalued, you've got a lot more leeway with the unknowables.
Well, yeah, but that is really just a chicken and egg problem. Earnings are very central to evaluating whether a stock is fairly priced in the first place. So if you can't get a god handle on earnings, how are you supposed to be confident that the stock is undervalued?