Thanks Trading Shard. Great to be back. Always entertaining to catch up on your new cheerleader cheers. Shake those pompoms girl! See you at the races. I'll be pulling for that C&J dragster!! Boogity Boogity!!.
Well, Ford has a PE of 3. Sometimes companies just don't get the love some people think they deserve. Like F, CJES just looks to good to be true for many on Wall Street. Maybe they expect all their contracts to be renewed at significantly lower rates over time. As earnings shrink, PE ratios will rise assuming the price stays constant. Sometimes the conference call gives out hints as to the future. The trick is to be able to pick out the appropriate hints and invest/trade accordingly. Personally, I think analysys are waiting for expansion into international environments before they issue new strong buy opinions. Without expansion into oversea markets, CJES is a stagnant company until NG turns around.
Comparing CJES to F is lazy at best. 55% of the most recent annual $20 billion in profit was income tax credit related. Minus the Q4 $13 billion in profit, F has seen their earnings drop sequentially each of the past 4 quarters. The current run rate at F over 4 quarters is about $4.4 billion. That is around a 10 PE if that number sticks..... twice as high as CJES, and Ford is seeing their earnings drop. Add the fact that F has $100 billion in debt, which over twice as much as the market value of the company, and you begin to see the market's concern for Ford. A 2% uptick in interest rates would see their projected income cut in half.
That said, shoot - give CJES a 10 PE like the debt laden earnings dropping company that Ford is, and we can begin to talk about whether or not CJES is fairly valued here.
For whatever reason, you can't get yourself to admit you are wrong and that CJES is ridiculously cheap here. Your call when price was at $17 for a move to $14-$16 was and will remain off by a mile. You desire to be right can be the only reason that you are being kept from seeing the gift you are being given at these prices.