For example, the chart below shows the % of unique boutique s in the SPX with an RSI-5 above 70 (green line). Nope. Ed Yardeni shows that forward EPS estimates, which is a key measure of institutional sentiment, are rising (annotations in purple are mine). Discounted cash holdings: There are some companies with significant cash balances, where investors do not trust the management of the company with their cash (given the track record of the company). Unlike some of the high-profile short sellers who seem to view Tesla as an over-hyped electric car company that is only a step away from tipping into default, I do believe that Tesla has a connection to its customers (and investors) that other auto companies would kill to possess, brings a technological edge to the game and has viable, albeit narrow, pathways to fair value. To set up the discussion of whether, and if so how, the actions of other investors, especially those with big names and reputations to match, affect your investing choices, I will fall back on a device that I have used before, where I contrast the value and pricing processes. I will choose to sit this investment out, letting others who are more nimble than I am or have more conviction than I do to take stronger positions in Tesla.
Advisory Services – even if you are conversant about the functioning of the stock market, take regular note of the happenings in the economy, and maintain a comprehensive knowledge of overall market conditions. Note that there are pathways that lead to the value at or above the current stock price but they all require navigating a narrow path of building up sales, earning healthy profit margins and reinvesting more like a technology company than an automobile company. In my last post, I looked at Apple, arguing, with a Monte Carlo simulation, that the stock was a good investment at the prevailing market price ($93 at the time of the analysis). In our interactive dashboard analysis on Snowflake’s Valuation: Expensive Or Cheap we break down the company’s revenues and valuation and compare it with other high-growth software players. Most analysis should be focused on identifying major turning points rather than predicting the duration of move.