Originally Posted by
Beagle
For what its worth I like to buy growth companies on a forward PE of 9 (representing no growth) + 1 PE more for each 1% estimated or proven rate of annual growth which I think is sustainable for the next 5-10 years. FPH's long run CAGR is 12% so in this instance I would consider it a great buy at 9 + 12 = 21 times estimated next years earnings which at a rough guess might settle at consensus estimate of 50 cps once all the analysts have updated their estimates. FPH would be a great buy at 50 cents estimated eps a PE of 21 = $10.50.
I seriously doubt FPH will go that low, (but you never know...there could be a huge exogenous shock to the market at some stage), so it probably won't ever get into my portfolio and I'm quite relaxed about that but there are plenty of stocks out there that fit my GARP (Growth at a reasonable price) great valuation search finding criteria. SUM a classic one which has a CAGR of 33% over the last decade but is unloved and will go back into my portfolio when TA suggests the timing is right. HGH and TRA are other examples of unloved growth stocks on compelling metrics.
I don't chase market darlings on stretched metrics, never have and never will and stick to what I know works for me. Good luck to holders, I think this downtrend still has quite some way to go.