Quote Originally Posted by value_investor View Post
What I don't understand is how after the last earnings downgrade, the stock fell from close to $8, down to below $7 and then back to $8. It literally went up in value after a profit downgrade. This would be understandable if the company was a good one. Like the company had strong fundamentals, or good management, or they were in a stable environment but FBU aren't!

This movement is ridiculous. How can a stock with 3 profit downgrades in a year be trading at such a strong multiple. Is there too much emotion about FBU out there? Perhaps a lot of older folks putting money into it. Or is this just the bull market?
THIS. It has actually gone up in value after its latest downgrades. I mentioned this after their 2nd downgrade and since then they have had two more and are still trading above $7.50.

Meanwhile MPG SP has been slaughtered and shown no mercy after seemingly less severe downgrades. It now is on a PE of less than 9