Tag Archives: Price earnings divergence

April 2013: Most Extreme Investor Leverage Since 2001 Bubble

Posted on June 13, 2013 by

In a recent article “Earnings-Price Divergence Always Followed by Negative Returns,” I noted that every extreme divergence (-20% or lower) between year-over-year corporate profits and equity prices in the past 50 plus years was followed by negative year-over-year equity returns.  … Continue reading →

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Earnings-Price Divergence Always Followed by Negative Returns

Posted on April 14, 2013 by

I recently wrote about the extreme divergence between earnings and equity prices, but did not have access to comprehensive historical earnings data until recently.  In the article above, I referenced the past few years of earnings data, which was provided … Continue reading →

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Posted in Economic Indicators, Fundamental Analysis, Market Commentary, Market Timing | Tagged , , , , | 5 Comments

Extreme Divergence: Earnings and Equity Prices

Posted on February 20, 2013 by

Earnings are the ultimate driver of stock prices and the divergence between earnings expectations and equity prices has become even more extreme.  Given that the market is technically overbought, implied volatility is extremely low, the CBOE Skew Index is over … Continue reading →

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Q4 2012 Earnings Preview

Posted on January 13, 2013 by

Earnings season is here again, which provides a timely reminder that earnings are the ultimate driver of stock prices.  The following article explores the recent trend in equity prices and earnings estimates.

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Posted in Economic Indicators, Fundamental Analysis, Market Breadth, Market Commentary | Tagged , , , , , , , | 2 Comments