mlk_man
07-25-2007, 06:42 AM
Combining Growth and Value Traits
Stephan Peasley
Klein, Pavlis & Peasley Financial, Inc.
http://www.bottomlinesecrets.com/images/drop_caps/blue_i.gif nvestment adviser Stephan Peasley always welcomes shares of companies whose earnings grow at an above-average rate. But he hates to pay a high price for any of them, so he waits for shares to be undervalued. To determine when the time is right, he looks beyond the stock price-to-earnings (P/E) ratio, which is a common measure that investors check. He also wants to see the projected earnings growth rate of a company much higher than the P/E ratio. If a company's earnings are expected to grow at an annual rate of 10% or more and its P/E ratio is 5, its growth-to-P/E ratio is a 2. Some of Peasley's favorite stocks now...
Woori Finance Holdings Co. Ltd. (WF) is a South Korean holding company for Woori Bank and other subsidiaries that operate 987 branches worldwide. Woori's growth-to-P/E ratio is about 2 and its return on equity is a solid 17%. The free trade agreement that South Korea signed with the United States should help this company grow as the Korean economy benefits from less strict trade barriers. Recent share price: $81.
Cybex International Inc. (CYBI) manufactures fitness equipment, including treadmills, stationary bikes and free weights, for the commercial and consumer markets. Management owns a healthy 36% of the shares. The growth-to-P/E ratio is a sound 1.7 and earnings and sales growth are accelerating. Recent share price: $7.
Sunrise Senior Living (SRZ) operates 450 senior living facilities for 40,000 residents in the United States, Canada and the United Kingdom. It offers full-scale nursing homes, assisted living and independent living facilities. Net income has consistently grown every year in the 10% to 15% range with one hiccup in 2004. This year earnings are expected to grow 16 percent. With an aging population, community homes for the elderly should enjoy continuous demand. Recent share price: $39.64.
Stephan Peasley
Klein, Pavlis & Peasley Financial, Inc.
http://www.bottomlinesecrets.com/images/drop_caps/blue_i.gif nvestment adviser Stephan Peasley always welcomes shares of companies whose earnings grow at an above-average rate. But he hates to pay a high price for any of them, so he waits for shares to be undervalued. To determine when the time is right, he looks beyond the stock price-to-earnings (P/E) ratio, which is a common measure that investors check. He also wants to see the projected earnings growth rate of a company much higher than the P/E ratio. If a company's earnings are expected to grow at an annual rate of 10% or more and its P/E ratio is 5, its growth-to-P/E ratio is a 2. Some of Peasley's favorite stocks now...
Woori Finance Holdings Co. Ltd. (WF) is a South Korean holding company for Woori Bank and other subsidiaries that operate 987 branches worldwide. Woori's growth-to-P/E ratio is about 2 and its return on equity is a solid 17%. The free trade agreement that South Korea signed with the United States should help this company grow as the Korean economy benefits from less strict trade barriers. Recent share price: $81.
Cybex International Inc. (CYBI) manufactures fitness equipment, including treadmills, stationary bikes and free weights, for the commercial and consumer markets. Management owns a healthy 36% of the shares. The growth-to-P/E ratio is a sound 1.7 and earnings and sales growth are accelerating. Recent share price: $7.
Sunrise Senior Living (SRZ) operates 450 senior living facilities for 40,000 residents in the United States, Canada and the United Kingdom. It offers full-scale nursing homes, assisted living and independent living facilities. Net income has consistently grown every year in the 10% to 15% range with one hiccup in 2004. This year earnings are expected to grow 16 percent. With an aging population, community homes for the elderly should enjoy continuous demand. Recent share price: $39.64.