13 replies to this topic

[NAV]

 

Expect the Senate to pass a crucial vote this evening.  Possible gap up in the cards.............

https://www.cnbc.com...rm-measure.html

Does anyone know what the current estimates are for the markets p/e ratio if corp taxs do get down to 20%?

 

 

 

This is an old article. But gives you the S&P earnings estimates based on the corp tax rate.

 

https://seekingalpha...-p-500-earnings

[NAV]

 

 

Expect the Senate to pass a crucial vote this evening.  Possible gap up in the cards.............

https://www.cnbc.com...rm-measure.html

Does anyone know what the current estimates are for the markets p/e ratio if corp taxs do get down to 20%?

 

 

 

This is an old article. But gives you the S&P earnings estimates based on the corp tax rate.

 

https://seekingalpha...-p-500-earnings

 

 

Based on that article, the S&P earnings estimate would be $151.70, if the corp tax rate reduces to 20%. At $151.70 earnings and today's price level of SPX 1570, the P/E would be about 16.9.

 

Without the tax cuts, as Redfoliage pointed out, the current P/E is around 25.

 

25 P/E vs 16 P/E, there's a mountain of difference. All of sudden we drop from obscene valuation to normal valuations, which most fundamental folks were complaining about.

Edited by NAV, 20 October 2017 - 12:47 PM.

[redfoliage2]

Just locked in the profit from the long positions set up yesterday morning at the dip.  I'd not hold any longs over the weekend as there are some geopolitical events running on over Europe and Asia and something may go very wrong there over the weekend...............

Edited by redfoliage2, 20 October 2017 - 12:55 PM.

[redfoliage2]

SPX Earnings:
http://www.investope...seline-vertical

122 for next year, add 10% from tax cut (assume all tax cut goes into earnings) it's 134. With today's price 2575 the PE would be 19, still about 20% higher than historic average15.6.

Edited by redfoliage2, 21 October 2017 - 09:25 AM.