Mag 7 PE < 20? How Much More Downside is There?

WallStreet_Tiger
04-07

After this market bloodbath, let's take a look at how the forward PE ratios of the Mag 7 are performing.

Two companies from the Mag 7, $Alphabet(GOOG)$ and $Amazon.com(AMZN)$ , have reached historic low PEs.

Google’s PE has dropped below 20, while Amazon stands at 27.07.

$NVIDIA(NVDA)$ is only 13% away from its historical lowest PE, and if it falls to $83, its stock price will reach the lowest forward PE in the past 10 years.

$Microsoft(MSFT)$ , $Meta Platforms, Inc.(META)$ , and $Apple(AAPL)$ are still far from their historical lows, but Meta’s forward PE has already dropped below 20, currently at 19.87.

$Tesla Motors(TSLA)$ is currently the highest valued company in the Mag 7, with a 202% gap to its historical lowest PE.

However, we cannot only focus on forward PE. Google’s valuation has been low for the past two years due to market concerns about AI replacing Google Search; while Tesla enjoys a high valuation for reasons we all know.

Do you believe in the PE indicator?

Besides PE, do you look at other metrics?

What is your target price for bottom fishing?

Mag 7 Jumps Over 10%! Take Profits or Keep Holding?
In yesterday's major rebound, MAG 7 surged over 10%. Despite the rebound, valuations are still at historically low levels. However, some believe that the market outlook remains unclear in the long term. Would you take profits at the right time or hold on for the long haul?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • Humbly
    04-07
    Humbly
    The unknown question is whether there will be a deep recession, which will slash all the forward EPS estimates
  • BenjiFuji
    04-08
    BenjiFuji
    PE is just a single indicator that looks at how price is versus earnings. We need to look deeper into why the earnings is such and what is driving the price story. I look at a whole lot of other indicators of which it depends on the type of company and the circumstances. [Grin]
  • Reallyxxx
    04-07
    Reallyxxx
    All fine if the “E” does not change. Right now that seems a rather ambitious assumption isn’t it?
  • SuperDuper1
    04-07
    SuperDuper1
    The problem is that the street hasn’t shaved EPS estimates yet
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