Upgraded information (kinda dumb that I don't know this!)

[Rich]

Ok, lets take Celgene for an example.

Today its showing a P/E of 110.5 x

When is this P/E along with other fundamentals upgraded, and is this true with every stock?

I checked into a stock today and they stated that they upgrade their information every Friday, this is why I'm asking this question, I thought fundamentals were upgraded every quarter.

Thanks all

RIch

[netwrangler]

Ok, lets take Celgene for an example.

Today its showing a P/E of 110.5 x

When is this P/E along with other fundamentals upgraded, and is this true with every stock?

I checked into a stock today and they stated that they upgrade their information every Friday, this is why I'm asking this question, I thought fundamentals were upgraded every quarter.

Thanks all

RIchDepends, I think, on whose posting the PE.

I usually go to Yahoo Finance. They show the PE-ttm (Trailing Twelve Months) based on the last four quarters of posted earnings and the intraday stock price. Five minutes ago, that was 110.55 for CELG.

Another PE of interest is one based on future earnings. There you need to determine where the future earnings projection is coming from.

Finally, the PEG ratio measures PE/growth. PEG is a rough guide to whether the PE is out of line with the projected growth of the company. Once again, you need to inspect the growth estimate. Is it reasonable? Are there confirming estimates?

Note: You can get some funny PE's and PEG's when current earnings are near zero. [Like, going from $0.01eps to $0.02/eps is 100% growth. Whoop-de-doo!] PE's and PEG's are meaningless when earnings are negative.

When I do DD on a company with low earnings, my basic question is, "What's the plan, here?" The had better be one articulated by management, or I'm not interested. Also, balance sheet health gets real important. Do they have the cash to see them through to the point where earnings are where they should be?

[Rich]

Depends, I think, on whose posting the PE.

I usually go to Yahoo Finance. They show the PE-ttm (Trailing Twelve Months) based on the last four quarters of posted earnings and the intraday stock price. Five minutes ago, that was 110.55 for CELG.

Another PE of interest is one based on future earnings. There you need to determine where the future earnings projection is coming from.

Finally, the PEG ratio measures PE/growth. PEG is a rough guide to whether the PE is out of line with the projected growth of the company. Once again, you need to inspect the growth estimate. Is it reasonable? Are there confirming estimates?

Note: You can get some funny PE's and PEG's when current earnings are near zero. [Like, going from $0.01eps to $0.02/eps is 100% growth. Whoop-de-doo!] PE's and PEG's are meaningless when earnings are negative.

When I do DD on a company with low earnings, my basic question is, "What's the plan, here?" The had better be one articulated by management, or I'm not interested. Also, balance sheet health gets real important. Do they have the cash to see them through to the point where earnings are where they should be?

Then Scottrade uses the same P/E over the 12 months as well. Allow me to copy and paste Scottrades fundies on this stock so I can review a few things.

Here are my concerns.

If the current P/E and other information was based on the last four quarters and did NOT include the huge 40% hit this last quarter, then just about all the information is of no use in real estimates to the value of the stock as it currently stands. Right?

My thinking is, the PE and the PEG has to be way off now after the stock dropped from $75 to $43. How does one really determine if this stocks current price is the right place to buy? The current PE is 110 based on the last four quarters and doesn't recognize any numbers for this quarter, doesn't this mean this stock could actually have a PE of about 150 or higher, or it could be the company didn't do that bad and the sell off was unjust, then the PE would be a great deal lower. But how is one to know without current facts? Currently, in my view, this is (was) and expensive stock when it was at $75.

BTW, I don't question the strength of this company, I was researching for an entry point and with everything based upon numbers before the drop I can't really determine much of anything because my mind comes back with 'based on what information". I do hope Im making some sense.

I would love to find a site or book that actually disects a companies fundamentals and financial reports. I assume for Chinaman/AJ and a few others who day trade this isn't that important, for those of us whose jobs force us to buy and walk away sometimes for a week it helps our nerves. Without knowing how to deal with old numbers, i'm trigger shy. I don't want another SHLD or VMC in my portfolio.

Here is a copy and paste of Celgene from Scottrade for convience of those interested in this discussion.

Celgene Corp CELG:NASDAQ
Sector: Healthcare Industry: Biotechnology & Drugs
47.00 -0.15 -0.32% 3,737,126 Last Trade as of 4:00 PM ET 12/28/07 Trade Add to Watchlist
Last Change / % Change Volume S&P Ranking

Set AlertsSummary News Charts Options Fundamentals Insiders Earnings Financials SEC Filings Profitability
Gross Margin (TTM) 90.6%
Net Profit Margin (TTM) 13.7%
Operating Margin (TTM) 27.4%
Pretax Margin (TTM) 33.7%

Valuation Financial Strength
P/E excluding extraordinary items (TTM) 114.9x
P/E Normalized (MRFY) 257.5x
P/Sales (TTM) 14.4x
P/Tangible book (MRQ) 7.8x
P/Cash Flow (TTM) 88.4x
Current Ratio (MRQ) 4.72
Quick Ratio (MRQ) 4.63
LT Debt/Equity (MRQ) 0.00
Total Debt/Equity (MRQ) 0.16
Payout Ratio (TTM) 0.00

Management Effectiveness Growth
Return on Assets (TTM) 7.1%
Return on Equity (TTM) 10.5%
Return on Investments (TTM) 8.5%
Sales (5Yr) 51.1%
Earnings Per Share (EPS)(TTM) 222.3%
Dividend Growth (5Yr) --

Income Statement Per Share Data
Revenue (MRQ) 349.9M
EBITDA (MRQ) 88.0M
Earnings before taxes (MRQ) 113.3M
Net Income (MRQ) 38.8M
Normalized earnings before taxes (MRQ) 113.3M
Normalized Net Income (MRQ) 38.8M
EPS excluding extraordinary items (TTM) 0.41
EPS Normalized (MRFY) 0.18
Rev per share (TTM) 2.81
BV per share (MRQ) 6.43
Tangible BV per share (MRQ) 6.07
Cash per share (MRQ) 6.56
Cash flow per share (TTM) 0.46
Indicated Annual Dividend (US) --

Company Overview
Celgene Corporation is a multinational integrated biopharmaceutical company. The Company is primarily engaged in the discovery, development and commercialization of therapies designed to treat cancer and immune-inflammatory-related diseases. The Company�s lead product is REVLIMID (lenalidomide), which was approved by the United States Food and Drug Administration (FDA) in June 2006 for the treatment of patients with transfusion-dependent anemia due to low- or intermediate-1-risk myelodysplastic syndromes associated with a deletion 5q cytogenetic abnormality with or without additional cytogenetic abnormalities (MDS). The portfolio of drug candidates in its product pipeline, including a pipeline of IMiDs compounds, which are a class of compounds having certain immunomodulatory and other properties. The products offered by the Company include REVLIMID, ALKERAN and Ritalin/FOCALIN.

[Rich]

Wow, after closing the PE changed on both Yahoo and Scottrade, but both have a different PE number.

Scottrade went from 110.5 to 114.9
Yahoo changed to 112.17
CELG opened at 47.20 and closed at 47. It went down and the PE went up 3.
Nothing important, just seems that they do change daily.

I'm emailing scottrade tonight to find out the story about thieir changing the information and when its done. I will probably get a reply next March from them :-(
Rich

[netwrangler]

Here is a quick reply [which means I just skimmed your last post and will post a more 'thoughtful' reply later.]

One of the things I learned from investing in AMGN and [later] talking with Englishman26 is that biotech stocks are subject to huge changes in price based on changes in attractiveness of their product pipeline. Here is what the Morningstar analyst says about CELG:

The market for the first-line treatment of multiple myeloma has clearly become more competitive this year, and data released at this year's annual meeting of the American Society of Hematology for Celgene's CELG Revlimid and Millennium's MLNM Velcade only confirm this fact. Because we've already factored Velcade's growing potential as a first-line treatment option into our valuation models for both firms, we're not making any changes to our fair value estimates at present.

We think data released over the weekend for Celgene's Revlimid were strong--patients with first-line multiple myeloma taking Revlimid in combination with the steroid dexamethasone saw high long-term survival rates. However, Millennium's Phase III VISTA trial--which tested Velcade in first-line patients--revealed a level of complete response that Revlimid hasn't matched to date. We continue to view both drugs as strong contenders for future sales in first-line multiple myeloma; not only are Revlimid's data still preliminary, but disease severity can also vary from trial to trial, making a direct comparison between the two drugs difficult without a head-to-head trial.

Future potential headaches for Celgene also came to the surface. Cephalon's CEPH Treanda showed impressive efficacy for the treatment of chronic lymphocytic leukemia and could be approved next year; this could make Revlimid's expansion into new blood cancer indications a tougher challenge. Japanese pharmaceutical firm Eisai announced that it plans to acquire MGI Pharma MOGN for $3.9 billion in cash, putting a high-powered firm behind MGI's Dacogen, which is a key competitor to Pharmion's (soon to be Celgene's) Vidaza. Making matters worse, if Celgene shares continue to trade at current prices leading up to the close of the Pharmion acquisition next year, shareholders will face additional dilution, according to the terms of the agreement.

That said, we think our discounted cash-flow models for both Millennium and Celgene assign reasonable growth potential to both Velcade and Revlimid. These drugs should share the first-line multiple myeloma market, as both drugs clearly benefit patients today and could even be used in combination in the future. New indications for Velcade and Revlimid--and progress with pipeline candidates--remain key to creating value at each of these firms.Englishman26's advice to me was to think ETF in this sector unless I had some very good ways to evaluate the drug pipelines. [I do not.]

My EFT search yields:

FBT
XBI
PBE
IBB

Haven't had a chance to check any of these EFTs out.
I did mention this was 'quick' reply. :wink: