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.........it is the EPS which drives a share price up (or down) - all other indicators are important to a greater or lesser extent but the EPS is the most important driver.

I have been saying things along similar lines for quite a while now, in a few different ways. ie Earnings.
I don't know if I would pinpoint it to EPS. There are a few different ways to measure basically the same thing.
ROA
ROE
EPS
Owner earnings.
Cashflow.
Call it what you will. Its all basically measuring the same thing.
Why wouldn't I pinpoint it to EPS? Purely because Buffett says you can't.
I can also think of an example where earnings are not the most important consideration.
eg Company ABC has 10 million shares and 30 million options outstanding. What is more important EPS or options?
Personally I DO use EPS but am attempting to educate myself to where I understand fully Buffetts' point of view.

I agree that earnings are the most important driver - long term.
The most important driver - short term - is public perception, psychology, etc. This is where the long term investor gets his advantage. Make use of short term mispricings to buy long term value.
As Ben Graham said, "In the short term the market is a voting machine, in the long term it is a weighing machine."

regards
Barcoo
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