Go to Jeff Salisbury LWGate Home Page.From: "Fred Richards" <adrich@gte.net>
Subject: RE: [CANSLIM] Newbie question - Definition of Earnings
Date: Fri, 31 May 2002 05:05:46 -0500
Next Article (by Subject): Re: [CANSLIM] Online trading "Tom Worley"
Previous Article (by Subject): Re: [CANSLIM] Newbie question - Definition of Earnings "Katherine Malm"
Top of Thread: Re: [CANSLIM] Newbie question - Definition of Earnings "Tom Worley"
Articles sorted by: [Date]
[Author]
[Subject]
This is a multi-part message in MIME format.
- ------=_NextPart_000_0014_01C20860.D2835460
Content-Type: text/plain;
charset="iso-8859-1"
Content-Transfer-Encoding: 7bit
Katherine,
You've got quite a few more trips around the calendar before you can even
begin to think about "senior moments."
Too late, we get smart.
Fred
-----Original Message-----
From: owner-canslim@lists.xmission.com
[mailto:owner-canslim@lists.xmission.com]On Behalf Of Katherine Malm
Sent: Thursday, May 30, 2002 10:52 PM
To: canslim@lists.xmission.com
Subject: Re: [CANSLIM] Newbie question - Definition of Earnings
Hi Tom,
You're absolutely right and I already caught the error in my example
earlier today and posted a correction...somehow what was in my brain and
what ended up in the example didn't match....probably further down in your
in box!!!
Katherine
Here's the always eloquent Emily Dickenson on "senior moments"...
I felt a clearing in my mind
As if my brain had split;
I tried to match it, seam by seam,
But could not make them fit.
The thought behind I strove to join
Unto the thought before,
But sequence ravelled out of reach
Like balls upon the floor.
----- Original Message -----
From: Tom Worley
To: canslim@lists.xmission.com
Sent: Thursday, May 30, 2002 10:45 PM
Subject: Re: [CANSLIM] Newbie question - Definition of Earnings
sorry, Katherine, you don't make many mistakes. If there was a split
effective during the quarter, then the earnings per share of the prior
quarters are all adjusted to a split based level, so prior quarter becomes
50 cents to compare to latest .625
a better example is where the company has bought back a lot of shares
during the current quarter, thus inflating the earnings per share as fewer
shares now outstanding. For this reason, I always look at earnings both in
terms of total money, as well as earnings per share. It can sometimes make a
big difference.
Likewise, if there was a new issue of shares early in the current
quarter, it might make earnings per share look weak due the weighted average
shares outstanding in latest quarter.
----- Original Message -----
From: Katherine Malm
To: canslim@lists.xmission.com
Sent: Thursday, May 30, 2002 3:05 PM
Subject: Re: [CANSLIM] Newbie question - Definition of Earnings
Hi Kelly,
Earnings and revenues are always measured on a per share basis so as to
compare apples to apples. This is important, because the company may have
increased/decreased the number of shares outstanding from one time period to
the next, then each individual share's piece of the pie will be different.
Example:
Total Earnings/Net Income quarter 1: $10m
Total Earnings/Net Income quarter 2: $12.5m
+25 % , right?
Add the following outstanding share info:
Total Earnings/Net Income quarter 1 = $10m. Shares = 10m
Earnings per share = $1/share
Company has a 2 for 1 split during the quarter, so
Total Earnings/Net Income quarter 2 = $12.5m Shares = 20m
Earnings per share = $0.625/share
Growth in earnings per share QoQ = NEGATIVE 37.5%!
Also be sure to visit www.investors.com/learn to find answers to
questions like this.
Katherine
----- Original Message -----
From: Kelly Short
To: canslim@lists.xmission.com
Sent: Thursday, May 30, 2002 1:45 PM
Subject: [CANSLIM] Newbie question - Definition of Earnings
IBD's Top 20 Investing Tips includes the following two points on which
I'm confused:
1. Consider buying stocks with each of last three years' earnings up
25% or more, ROE of 17%+ and recent earnings and sales accelerating.
2. Recent quarterly earnings and sales should be up 25% or more.
When they say "earnings" do they mean earnings per share or sales, net
income, or other number? I would greatly appreciate input on this obviously
newbian question.
Kelly Short
Business Development Manager
Neoris, Inc.
(817) 731-0995
mailto:kelly.short@neoris.com
http://www.neoris.com
-
-To subscribe/unsubscribe, email "majordomo@xmission.com"
-In the email body, write "subscribe canslim" or
-"unsubscribe canslim". Do not use quotes in your email.
- ------=_NextPart_000_0014_01C20860.D2835460
Content-Type: text/html;
charset="iso-8859-1"
Content-Transfer-Encoding: quoted-printable
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN">
<HTML><HEAD>
<META http-equiv=3DContent-Type content=3D"text/html; =
charset=3Diso-8859-1">
<META content=3D"MSHTML 6.00.2712.300" name=3DGENERATOR>
<STYLE></STYLE>
</HEAD>
<BODY bgColor=3D#ffffff>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2>Katherine,</FONT></SPAN></DIV>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2></FONT></SPAN> </DIV>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2>You've=20
got quite a few more trips around the calendar before you can even begin =
to=20
think about "senior moments."</FONT></SPAN></DIV>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2></FONT></SPAN> </DIV>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2>Too=20
late, we get smart.</FONT></SPAN></DIV>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2></FONT></SPAN> </DIV>
<DIV><SPAN class=3D630530210-31052002><FONT face=3DArial color=3D#0000ff =
size=3D2>Fred</FONT></SPAN></DIV>
<BLOCKQUOTE dir=3Dltr style=3D"MARGIN-RIGHT: 0px">
<DIV class=3DOutlookMessageHeader dir=3Dltr align=3Dleft><FONT =
face=3DTahoma=20
size=3D2>-----Original Message-----<BR><B>From:</B>=20
owner-canslim@lists.xmission.com=20
[mailto:owner-canslim@lists.xmission.com]<B>On Behalf Of </B>Katherine =
Malm<BR><B>Sent:</B> Thursday, May 30, 2002 10:52 PM<BR><B>To:</B>=20
canslim@lists.xmission.com<BR><B>Subject:</B> Re: [CANSLIM] Newbie =
question -=20
Definition of Earnings<BR><BR></FONT></DIV>
<DIV>Hi Tom,</DIV>
<DIV> </DIV>
<DIV>You're absolutely right and I already caught the error in my =
example=20
earlier today and posted a correction...somehow what was in my brain =
and what=20
ended up in the example didn't match....probably further down in your =
in=20
box!!!</DIV>
<DIV> </DIV>
<DIV>Katherine</DIV>
<DIV> </DIV>
<DIV>Here's the always eloquent Emily Dickenson on "senior =
moments"...</DIV>
<DIV> </DIV>
<DIV>I felt a clearing in my mind<BR>As if my brain had split;<BR>I =
tried to=20
match it, seam by seam,<BR>But could not make them fit.<BR><BR>The =
thought=20
behind I strove to join<BR>Unto the thought before,<BR>But sequence =
ravelled=20
out of reach<BR>Like balls upon the floor.<BR></DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dstkguru@bellsouth.net =
href=3D"mailto:stkguru@bellsouth.net">Tom=20
Worley</A> </DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A =
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Thursday, May 30, 2002 =
10:45=20
PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] Newbie =
question=20
- Definition of Earnings</DIV>
<DIV><BR></DIV>
<DIV><FONT face=3DArial>sorry, Katherine, you don't make many =
mistakes. If=20
there was a split effective during the quarter, then the earnings =
per share=20
of the prior quarters are all adjusted to a split based level, so =
prior=20
quarter becomes 50 cents to compare to latest .625</FONT></DIV>
<DIV style=3D"FONT: 10pt arial"> </DIV>
<DIV style=3D"FONT: 10pt arial"><FONT size=3D3>a better example is =
where the=20
company has bought back a lot of shares during the current quarter, =
thus=20
inflating the earnings per share as fewer shares now outstanding. =
For this=20
reason, I always look at earnings both in terms of total money, as =
well as=20
earnings per share. It can sometimes make a big difference. =
</FONT></DIV>
<DIV style=3D"FONT: 10pt arial"><FONT size=3D3></FONT> </DIV>
<DIV style=3D"FONT: 10pt arial"><FONT size=3D3>Likewise, if there =
was a new=20
issue of shares early in the current quarter, it might make earnings =
per=20
share look weak due the weighted average shares outstanding in =
latest=20
quarter.</FONT></DIV>
<DIV style=3D"FONT: 10pt arial"><FONT size=3D3></FONT> </DIV>
<DIV style=3D"FONT: 10pt arial">----- Original Message -----=20
<DIV style=3D"BACKGROUND: #e4e4e4; font-color: black"><B>From:</B> =
<A=20
title=3Dkmalm@earthlink.net =
href=3D"mailto:kmalm@earthlink.net">Katherine=20
Malm</A> </DIV>
<DIV><B>To:</B> <A title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV><B>Sent:</B> Thursday, May 30, 2002 3:05 PM</DIV>
<DIV><B>Subject:</B> Re: [CANSLIM] Newbie question - Definition of=20
Earnings</DIV></DIV>
<DIV><BR></DIV>
<DIV>Hi Kelly,</DIV>
<DIV> </DIV>
<DIV>Earnings and revenues are always measured on a per share basis =
so as to=20
compare apples to apples. This is important, because the company may =
have=20
increased/decreased the number of shares outstanding from =
one time=20
period to the next, then each individual share's piece of the pie =
will be=20
different.</DIV>
<DIV> </DIV>
<DIV>Example:</DIV>
<DIV>Total Earnings/Net Income quarter 1: $10m</DIV>
<DIV>Total Earnings/Net Income quarter 2: $12.5m</DIV>
<DIV>+25 % , right?</DIV>
<DIV> </DIV>
<DIV>Add the following outstanding share info:</DIV>
<DIV>Total Earnings/Net Income quarter 1 =3D=20
$10m. Shares =3D =
10m =20
Earnings per share =3D $1/share</DIV>
<DIV>Company has a 2 for 1 split during the quarter, so</DIV>
<DIV>Total Earnings/Net Income quarter 2 =3D=20
$12.5m Shares =3D=20
20m Earnings per share =3D $0.625/share</DIV>
<DIV> </DIV>
<DIV>Growth in earnings per share QoQ =3D NEGATIVE 37.5%!</DIV>
<DIV> </DIV>
<DIV>Also be sure to visit <A=20
href=3D"http://www.investors.com/learn">www.investors.com/learn</A> =
to find=20
answers to questions like this.</DIV>
<DIV> </DIV>
<DIV>Katherine</DIV>
<BLOCKQUOTE=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- =
</DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dkelly.short@neoris.com =
href=3D"mailto:kelly.short@neoris.com">Kelly=20
Short</A> </DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A=20
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Thursday, May 30, =
2002 1:45=20
PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] Newbie =
question -=20
Definition of Earnings</DIV>
<DIV><BR></DIV>IBD's Top 20 Investing Tips includes the following =
two=20
points on which I'm confused:<BR>1. Consider buying stocks with =
each of=20
last three years' earnings up 25% or more, ROE of 17%+ and recent =
earnings=20
and sales accelerating.<BR>2. Recent quarterly earnings and sales =
should=20
be up 25% or more.<BR>When they say "earnings" do they mean =
earnings per=20
share or sales, net income, or other number? I would greatly =
appreciate input on this obviously newbian =
question.<BR><BR><BR>Kelly=20
Short<BR><BR>Business Development Manager<BR>Neoris, Inc.<BR>(817) =
731-0995<BR><A=20
=
href=3D"mailto:kelly.short@neoris.com">mailto:kelly.short@neoris.com</A><=
BR><A=20
=
href=3D"http://www.neoris.com">http://www.neoris.com</A><BR><BR><BR>-<BR>=
- -To=20
subscribe/unsubscribe, email "<A=20
=
href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>-In=
=20
the email body, write "subscribe canslim" or<BR>-"unsubscribe=20
canslim". Do not use quotes in your=20
email.</BLOCKQUOTE></BLOCKQUOTE></BLOCKQUOTE></BODY></HTML>
- ------=_NextPart_000_0014_01C20860.D2835460--
- -
- -To subscribe/unsubscribe, email "majordomo@xmission.com"
- -In the email body, write "subscribe canslim" or
- -"unsubscribe canslim". Do not use quotes in your email.
Next Article (by Subject): Re: [CANSLIM] Online trading "Tom Worley"
Previous Article (by Subject): Re: [CANSLIM] Newbie question - Definition of Earnings "Katherine Malm"
Top of Thread: Re: [CANSLIM] Newbie question - Definition of Earnings "Tom Worley"
Articles sorted by: [Date]
[Author]
[Subject]