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/biz/ - Business & Finance

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18301051 No.18301051 [Reply] [Original]

How do I know if a stock is undervalued or just junk?

>> No.18301082

Time to read up, bitch
https://shareholder.ford.com/investors/overview/default.aspx

>> No.18301095

>>18301051
>DCF

>> No.18301283

>>18301095
Big brained

>> No.18301814

>>18301051
Thats simple, if I buy it you know to stay away from it, if I sell it you know to buy it. I am literally the "He bought? He sold?" Guy in those youtube videos

>> No.18301858

>>18301051
By NOT looking at the chart from the past and thinking..."hey look the price was way more where it's at now, SURELY it will go back up and I'll get an easy 10x!" Or at least that seems to be what you're implying.

>> No.18301881

>>18301814
what did you buy? what did you sell?

>> No.18301899

>>18301858
it seems very cheap and ford is still a well recognized brand name. why wouldn't it go back up?

>> No.18301962

Lots of ways, some very complex. Price/earnings ratio is a good one. If P/E is over 15 its definitely overpriced.

>> No.18302009

>>18301962
if 15 is high then 120 must be a huge ripoff

>> No.18302096

>>18302009
That means it would take 120 YEARS to make a profit if you bought the shares for dividend income.

>> No.18302156

>>18302096
is the only reason someone would buy shares of a company with a 120 p/e ratio is because they are confident the company can bring its earnings up?

>> No.18302160

By considering what the company is, what it is trying to do, and what is likely to happen. Let's look at Ford

Ford was founded at the beginning of the last century and through many innovations became the top dog of the auto industry for a long time. Ford, along with all the domestic manufacturers, in the 60s, had it so good with car sales in the US that they pretty much forgot how to innovate. The gas crisis and smog/safety regulations hit in the early 70s, the domestics made poor decision after poor decision essentially trying to still make 1960s cars with low compression ratios and primitive smog tech. The cars grew heavier, made less power, and were pretty much just 100% top to bottom shit, and eventually the domestics lose a lot of their market share to emerging Japanese and Euro imports.

Even with all sorts of incentives and things like the chicken tax, the domestics including Ford still continually lose market share and relevance for decades up until the 2010s until they are all bailed out for being essentially worthless companies (people argue Ford wasn't actually bailed out but they had to take massive loans with stipulations that do not benefit any taxpayer, so it's still a bailout, though not as egregious as GM or Chrysler).

They all continue to make cars that are pretty much shit, but in the later 2010s full size truck sales are booming. Ford makes more profit from the F150 than their entire company's net profit, which means the F150 is subsidizing everything they do. They openly share that they are trying to not make any passenger cars other than the Mustang at some point a few years ago.

tl;dr: they have the biggest advantage and captive market possible for decades until the 60s, lose out to imports by not innovating, eventually get bailed out, then again bank their strategy on not innovating but squeezing as much money possible out of a single facet of the auto industry (full size gas powered trucks). Does this seem like a good move to you?

>> No.18302314

>>18302156
Or because they think the price will increase enough for a profitable flip.

>> No.18302379

>>18301051
you can look up how much cash they are holding, and offset the amount of debt they're in.

>> No.18302607

>>18302009
>>18301962
yeah like that AMD shitcoin. i bought when the stock was 0.34 and in 4 months it jumped to 50$+. P/E = 54 last time i checked.

>> No.18302639

>>18302160
Not the same guy and ill have to read a bit on my own but thanks for taking the time to write that

>> No.18303047

>>18302160
it looks like a very risky move to me. too many people buying big expensive trucks on credit is not sustainable

>> No.18303144

>>18301899
Maybe it's not undervalued right now but instead was overvalued before?

>> No.18303146

>>18302639
>>18303047
Sure. Many people on this board are perplexed that investors dump money into Tesla. Tesla is involved in a bunch of emerging markets/tech (pure EVs, solar, energy storage both residential and commercial, autonomous driving, etc.). It's not hard to imagine EVs going from .5% market share to 30% market share, solar installations becoming 10x more common, etc. Contrast to Ford, it is pretty much impossible to imagine betting everything on F150s being successful long term. They aren't going to sell millions of them in China, they aren't going to lower the cost to produce them to increase profits significantly, it already looks like the US full size truck market is near topped out. Personally if I am going to invest in something it's going to be a company with a lot of room to breathe and a focus on innovation.

>> No.18303160

>>18301051
by using market psychology rather than meme TA

>> No.18303194

Ford is a shit show. Its 8 cylinder module coyote engine block is a piece of shit. This is 3rd generation and they still consume oil and are not reliable enough for the public to keep on buying the brand. The 2.3 eco boost is better but marginal.
The aluminum used on its car and truck line has changed in quality and its a even poorer version.
The electric line will get another factory soon and more production will be focusing on EV. Makes sense because the gas powered engines and the manufacturer process has gone to shit.
If the ford EV sector can maintain Ford might be OK.

t.auto industry exec

>> No.18303475

>>18303160
explain market psychology

>> No.18303616
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18303616

>>18303475
google trends, rumors, etc.
heck, even scouting /biz/ is one way to gain foresight

>> No.18303634

>>18303475
also other shitcoin forums and l*ddit

>> No.18303650

>>18301051
You don't. You do quantitative modeling of the entire stock market and trade high volumes of stocks that give you a 51% chance of winning. The sum of those wins should allow you to beat the market. Problem is leverage is shit for retail accounts.

>> No.18303674

>>18301051
>undervalued
No such thing, simply what the market will pay. don't think you are smarter than the market. You don't have any inside info

>> No.18304303

>>18301051
look at Ford's debt-equity ratio and then look at Macy's

>> No.18304320

>>18301082
this or simply run through the company books retard