Beware the Financial Destruction of Overvaluation

Introduction

After such an extended bull run it’s only logical to assume that many stocks are trading at frothy valuations.  On the other hand, it’s also important to keep in mind that it is a market of stocks and not a stock market.  Nevertheless, the truth is that many stocks are now significantly overvalued based on both historic norms and fundamental values.  This is not true of all stocks, because it is also true that there are high quality stocks available today that are fairly valued.  However, they are admittedly getting more difficult to find.

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Emerson Electric: High-yield, Sound Valuation and 59 Consecutive Years of Dividend Increases, Part 2

Introduction

When I’m looking for a stock to add to my portfolio, there’s nothing more frustrating than spending a significant amount of time and effort on research – only to discover that the company in question is significantly overvalued.  Consequently, my first step always starts out with an assessment of the relative valuation of the company I am considering.  No matter how much I admire the company, its management team and its financial health and strength, I simply refuse to pay more for a stock than I believe it is worth.  The most commonly accepted investing principle is to buy low and sell high.

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How to Determine the Value of a Cyclical Stock like Emerson Electric: Part 1

Introduction Identifying the intrinsic value of a cyclical stock is more difficult than valuing a company with a steady history of growing earnings.  However, there are many Dividend Aristocrats and Dividend Champions that are, in fact, cyclical companies.  In spite of this cyclicality, they have been able to steadily increase their dividends for over 25 Read more about How to Determine the Value of a Cyclical Stock like Emerson Electric: Part 1[…]

Retired Investors Should Give This Blue-Chip Technology Stalwart a Close Look

Introduction I believe that building and managing a successful stock portfolio is simple and straightforward, but not necessarily easy.  Building and successfully managing a portfolio of individual stocks requires work, a disciplined philosophy and a reasonable commitment of time.  But perhaps most importantly, it’s critical to start out with a precise understanding and acceptance of Read more about Retired Investors Should Give This Blue-Chip Technology Stalwart a Close Look[…]

Mid-cap Dividend Growth Stocks by Sector – Part 2C: REITs and Real Estate Management

Introduction This is the final installment in my series of articles on fairly valued mid-cap selections.  My inspiration to produce these articles was at the request and suggestion from regular readers who were frustrated at the lack of coverage and/or articles on mid-caps.  To accommodate those requests, I screened through the S&P 400 mid-cap index Read more about Mid-cap Dividend Growth Stocks by Sector – Part 2C: REITs and Real Estate Management[…]

Have FUN Researching Stocks Deeper

Introduction I’ve recently had several requests from MisterValuation subscribers on how to better utilize FUN Graphs. The following post on the MisterValuation forum represents an example of the questions I’ve been receiving: “FUN Graphs Chuck, I don’t believe I am getting the full benefit of the data presented in FUN graphs. Over the last two Read more about Have FUN Researching Stocks Deeper[…]

9 Fairly Valued Mid-Cap Consumer Discretionary Dividend Growth Stocks: Part 2B

Introduction Mid-cap stocks are often overlooked by investors and not widely covered on Wall Street or many financial websites and blogs.  However, I consider it a mistake because there are many mid-size companies that are attractive long-term investment opportunities. Moreover, in the general sense, smaller companies tend to have more room to grow than their Read more about 9 Fairly Valued Mid-Cap Consumer Discretionary Dividend Growth Stocks: Part 2B[…]

Mid-Cap Dividend Growth Stocks by Sector: Part 2A Regional Banks

Introduction In part 1 of this series on fairly valued mid-cap investment opportunities I primarily focused on non-dividend paying growth oriented mid-caps.  In part 2 of this series I turned my focus to finding fairly valued dividend paying mid-caps.  However, as I was evaluating dividend paying mid-caps in the S&P 400 mid-cap index, it became Read more about Mid-Cap Dividend Growth Stocks by Sector: Part 2A Regional Banks[…]

10 Mid-Size Stocks for Large-Size Gains: Part 1

Introduction Small and mid-sized companies are often overlooked by many or even most investors.  That’s unfortunate, because there are many excellent investment opportunities that can be found in these equity classes.  However, an argument could be made that between the small and mid-cap equity classes, the best and perhaps less risky investment opportunities are found Read more about 10 Mid-Size Stocks for Large-Size Gains: Part 1[…]

Dynamite Comes in Small Packages: 10 Small Caps for Explosive Returns

Introduction Investing in small-cap stocks is not for everyone.  My definition of small-cap is a company whose market is $5 billion or less.  However, for those brave souls that are willing to assume a little more risk, they can, under the right conditions, be a very profitable choice.  Nevertheless, and in the general sense, small Read more about Dynamite Comes in Small Packages: 10 Small Caps for Explosive Returns[…]