"Due course?" Whatever. The last split was in 2001. It took 14 years for the price to double. Which means the price increased on average 5% per year. I guess those "great unwashed" (could you be any more condescending?) just weren't all that interested in doubling "our money." If past performance predicts future performance, it will be 2030 at the soonest when "our money" doubles again.
That would be the largest increase for JNJ in something like forever. 20 cents much more likely. Nothing in the financials justifies more.
Because it's like a magic trick. You get free shares. If it's a 2-1 split, you get twice as many shares, without spending any money. They're free shares. And best of all, the price per share goes down by half, but the P/E ratio stays the same. Say a stock is at $100, with a P/E of 18, then it splits and now it's at $50 with a P/E of 18. Clearly, you'd rather buy a $50 stock with a P/E of 18 than have to pay $100 for a stock with a P/E of 18, right? Like I said, it's just magic, and those who hope for a split believe in magic.
Anybody notice this brilliant post? Just five short days ago, a big "sell, sell, sell" forecast, complete with the usual arrogant insults, from the wizardwart. Since then? Well, according to my simple math, RF is up almost 7%. Up 7% in five days after a "sell, sell, sell" post! WOW! With prognostic performance like that, he should go play the wheel in Vegas.
Nice increase from a percentage standpoint, but I'm surprised it's that low. Makes me wonder if there's some bad news coming, something that will eat into profits in a serious way.
Sorry habits, but a split doesn't do anything. And the stock NEVER "goes right back up to pre-split levels." When you look at a price chart, the prices are ADJUSTED to compensate for the split, so it APPEARS that the price immediately after the split is the same as the price immediately before. The post-split price doesn't actually rise to pre-split price until it doubles after the split. In the case of JNJ, that takes an average of 7-10 years. This is pretty elementary stuff. Check INVESTOPEDIA.
And you're actually arguing that despite the strong "underlying fundamentals of the business" that made JNJ a good investment, the price would NOT have risen from 100 to 130? The share price could only go up starting at 50? And according to your logic, that would be because without the lower price there would have been less demand because investors are too stupid to recognize good value? As we say here in the south: Bless your heart, I know you're doing the best you can.
Could be a wise decision. There's a lot of hoped-for good news baked into the current price. Nobody ever went broke taking a profit.
I've been investing in the market for almost 50 years, held through downturns and recessions, and have built wealth based on selection of companies that have a long history of growing earnings and increasing dividends. And I know a fool's post when I see one.
"Good time to accumulate"????? Let me be sure I understand. JNJ is at its ALL-TIME RECORD HIGH. And you're saying that's a "good time to accumulate"? That's your approach to wealth creation, wait until a stock reaches its all-time record high, and then start buying it? And just curious, what in the world do you mean by "sufficient share value will accumulate"? Meaningless statement. You really should be begging for advice rather than offering it.
It's really kind of amazing that somebody with absolutely no clue about the cause and effect of a stock split feels competent to to make financial decisions and invest money in the market. And apparently with no comprehension of basic arithmetic, simple division and multiplication. Lacking such basic skills, how do you even figure out whether you've made or lost money?
I nominate this spammer for "Worst Click-Bait Title of the Century." Earnings beat by a penny, and RF is up 5% in pre-market. Yes, there will be profit taking, but still, if that's a "turn for the worse," I hope things just get worse and worse.
The 2016 EPS estimates are around $2.25. PFE has historically had a P/E in the range of 15-20. At a P/E of about 17.5, for that EPS the price would be around $40. I would expect it to get there gradually as the EPS story unfolds. BUT, there are a lot of scenarios to consider. They could jump into another deal, most likely an acquisition, and they have a history of overpaying. That would hold share price down. And there's a lot of talk about splitting PFE into two or maybe three separate companies. That would probably boost share price. I'm holding, not buying, happy with the yield and glad I won't have to pay capital gains on a very nice profit.
Your lack of understanding of the drug development process is breathtaking. I worked in drug discovery and drug development for three major pharmaceutical companies, and I can state with confidence that there are no "taxpayer funds" involved in the process. In a start-up pharma, which has no revenues, the process is funded by the initial investors. Once a company has revenues, discovery and development is funded out of revenues. US pharma companies have no problem with paying US taxes, but they would like to have US taxes comparable to those of other 1st world countries, so that their competitors would not have the unfair advantage of lower tax rates. And, for what it's worth, if the tax burden were lower, US pharma could invest more in research and development, and increase dividends to shareholders.
Yes, absolutely, very astute argument. Because price is the only thing buyers look at. Nobody cares about fundamentals like P/E, earnings, earnings growth, % return, debt--those are just fussy trivialities. Price and market sentiment, that's what makes it all work. Buyers want an "attractive" stock. Thanks for enlightening us.
"RF acquisitions continue to lift the sales and profits. THe last two acquisitions positive additions will show up in coming quarters." Good to know. Are you sure you're on the right board?
I'm sure you know what you're talking about, because you use the word "synergy." Anybody who uses the word "synergy" is clearly an expert.