The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Rule Maker Strategy

URL:  https://boards.fool.com/greetings-mike-what-i-do-not-understand-is-how-22490635.aspx

Subject:  Re: I am confused. Date:  5/15/2005  4:23 PM
Author:  jbking Number:  18385 of 18386

Greetings Mike,

What I do not understand is how certain stocks with high P/Es can be considered "bargains."

If the growth rate is sufficiently high I can see this. The point of this being that if a company can grow by say 50% a year for a few years this should allow for a higher P/E, no? Secondly, recognize that some "bargains" are because they are a relative value, e.g. the lowest in a group of 10 may not be cheap on an absolute basis but is relatively a bargain compared to the other 9.

Just a couple of ideas,
JB
Copyright 1996-2019 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us