Thanks Chuck this helps a lot! Especially after selling a stock with a nice profit last year, only to see the price quadruple afterwards. But it wasn’t a „hold forever“ stock and I used my gains to reinvest the cash into other, fundamentally better businesses, so no hard feelings :)
I bought AAPL two splits ago, when it had fallen from ~$650 down to below $500. All the pundits were calling it a "sick" stock- but it was growing at >30% with a P/E of ~8! It was a great time to get in. I have >4 bagger now, and it is overvalued, but I don't want to dump this great co. My answer is to sell a few shares, IF I have another good place to invest the cash. In my case, it's other great cos. that have a higher and increasing dividend. That gives me more current income, and I still hold on to the bulk of APPL stock.
Well you had plenty of time 2 repurchase it. It's mentally tough 2 repurchase a stock you sold too early. I now make exceptions sometimes for exceptional companies & re buy @higher prices. It's admitting you sold 2early or the narrative changed. MOST IMPORTANTLY DON'T lose $$$$. I'd rather miss an Amazon than lose my capital & have to start over.
It's ok, I sold CMG at $70 30 shares in my wife's ROTH. And I told my dad to sell 37K worth of MSFT at $36 because it had done nothing much for 5 years. He bought VZ with that money, lol He's so mad at me. I told him to sell HBAN at $90 in 2007, just before the financial crisis in 08. He said his cost was $2 from 1972, (pre merger with other banks) so he wouldn't and he finally sold at $19 in 2008, it since spent a decade at 6-9,climbing to upper teens just this year.
Selling is many times more difficult than buying imho. Thanks for the video! I bought AAPL in 2012 and will not sell for over valuation reasons but with most companies I would
Perhaps the single most valuable nugget in this entire mother lode of timeless wisdom is @ 20:53, where Chuck observes "You really make your money on the buy side." SO TRUE. Embracing this deceptively simple yet pithy guidance and using it to inform all investment actions is the key to long term success. It's why, as Chuck asserts, "valuation matters and it matters a lot." Buy low, sell high. Sounds simple, right? But when you truly follow the first part (buy low), you find the second part (sell high) becomes easier - if it ever comes at all - because buying at attractive valuation also buys enhanced margin of safety and increased leverage (through potential valuation expansion). Thanks, Chuck, for yet another excellent and valuable presentation.
Chuck, I have been inspired by your words and videos for a relatively short time of several years and have benefited most times by your good counsel. However, this video was by far the best that you have presented. I already own ALL of the stocks you referred to in this video and have profited greatly already from each of them. As a result of your research I have today added to all of my positions. Please continue to make these videos and they represent a direction for any rational, reasonable, logical investor to follow. Thank you for all you do!
Thanks Chuck. I had Devon since 4 months and sold them making 6.5%. Was buying daily through Robin hood. Invested those in BMY. I am looking at PFG and PRU
Thanks, Chuck! One of the things I love about this channel is your heart to educate folks by listening and responding to our questions instead of "sticking to the script." I'm looking forward to more great content, but now I have to go brag to all my friends that I got a shout out on a RUclips channel with >20k subscribers. ;-)
Great analytical video as usual Chuck. 2017 and 2018 California wildfires caused by their equipment drove PG&E into bankruptcy. Thanks for saving one of my favorite holdings, PRU, for last. I am trying to reduce my portfolio from 30 stocks to 20. I like them all, so I only sell to generate funds to purchase more shares of stocks that I already own.
@@joeri2499 do you understand the word PROFITS? When I get a big run up I sell some because what goes up fast corrects and I get a better buy in price.
Hey Chuck, I really enjoy your videos and even as a financial professional I still learn from you watching these often. So, thank you for helping all of us. A big fan. Regarding the reason to sell has to do also with the opportunity cost. Which means that if you find another reasonably valued company with good earnings growth that is better than the existing position then that may be a good reason to sell and reposition. I think the return as it compares to an index is one of those things that should be a consideration as investors. I mean looking at some of these examples one could have feasibly held something like AAPL and then when it doubled sold off the cost basis to free up capital to invest in another value stock with good growth prospects thereby not having to get out of AAPL altogether and potentially holding the stock forever just redeploying some of your captial.
I prefer not to sell ALL of a winner, but I do like to trim some. If it drops, I'll buy some more. I sold some TSLA the end of January, and I just missed buying more in the higher 500s (my buy order was a bit lower). But I still have 80% of my TSLA position.
I've been struggling with the decision whether or not to sell 1/2 my position in ETN. ETN, looks to be way overvalued. I've owned it for a number of years, but going forward it looks to me to be quite risky from a valuation standpoint. I could sell and redeploy into a stock paying much higher dividends.
Sometimes i was wrong i buyed Plug for 2$ and sold at 10$.Rebuyed at 15$ and saw my mistake to not sell at 60 or 70$.But still have the Position and plan to Risk hold forever.But very Speculative.But i want to see what is in 20 Years with that Investment.Still had make great money by the first buy and sell and now still up 88% after the rebuy.
When i think one of my stocks is overvalued i really like trailing stops. Yes its overvalued but when it falls no one knows. How tight you make it is up to you :). Do realize anything you own that is overvalued (IE popular) can become more overvalued.
Better the time IN the market, than timING the market. it's very difficult to timing growth stocks, so I prefer to stay IN and hold, and buy more in the dip, if the dip is not caused by a fundamental deterioration of the business.
Aaron: Thanks. Actually, I always use both metrics and all the others on FAST Graphs when I am doing my research. As I often say about FAST Graphs, the tool does not dictate fair value it reveals it. I feel valuation is a puzzle and I utilize my "tool to think with" to help me make rational, and prudent decisions. Consequently, I utilize all the valuation tools at my disposal. Each metric provides its own insight that helps. regards, Chuck
@@FASTgraphs I was about to ask the same question. Maybe an idea for a future video ? Which metric says what ? P.S.: following your Channel every week, in the long run, educates us better than any university ever will. Thank you for what you do.
My dilemma was Mastercard (MA). I held for a number of years, but when it failed to make a new high and P/E was over 50 - I bailed. If MA had significantly dropped to maybe a 30 P/E, I would have bought back in - never has and has continued to go higher - sigh. I feel fortunate for my gains, but could not rationalize holding a stock I would not buy.
chuck, great video but I got one question left. If we take GEO or IBM, it often isn't clear that earnings will decline so it always looks like a proper value buy but in the retrospective, GEO and IBM were bad investments over last 5..6..7.. years (I consider this a long period of time) and It always looked like a turn around story, how can I avoid value traps and distinguish between great value buys and value traps...??
Mr International: I agree that 5, 6 and 7 years is a long time. However, it is not unusual. Regarding whether a stock is a value trap or not, nothing takes the place of comprehensive research and due diligence. Also, the real question is are the fundamentals fully deteriorating, is the company in transition, or are you seeing a temporary interruption in a strong business. Bottom line, I trust fundamentals more than price action. Regarding a situation like GEO group, politics have come into play. Nevertheless, the fundamentals continue to look adequate. Of course, the dividend cut suggests great risk. As for IBM, I believe the jury is still out. I do consider it a turnaround story myself, as long as the dividend continues to grow I'm going to be patient. Nevertheless, we all have to make our own decisions based on the information as we see it. But, at the end of the day, continuous monitoring and comprehensive research and due diligence are the only answer to your question, and it doesn't always work out. like Peter Lynch said if you our right 6 times out of 10 you are good. You are never going to be right 9 times out of 10.Regards, Chuck
Hi - is this the fastgraphs basic or fastgraphs pro? I'm really liking fastgraphs demos and thinking of subscribing but the pro is quite pricey. Thanks!
I have question 🙋♂️ you mention a lot about analysis on businesses that are mature with history but how do we evaluate new young emerging growth businesses that don’t have enough earning or fundamentals information available. I would love to hear your thoughts on this chuck 🙏
Jose: in my personal experience I have learned to be careful with young growth companies and IPOs. In many cases they turn out to be exceptional long-term investment opportunities. However, early hype often leads to irrational valuations, and price weakness host IPO. Consequently, patiently waiting until you either get earnings and other fundamental data most often leads to better entry prices. However, with the above said, often price to sales becomes the only metric that makes any sense with early-stage companies. But, even then it's also important to recognize that much of what's going on is speculation. Anyway, you're not the 1st to ask so I have been working on a video, perhaps now is the time to launch it. Regards, Chuck
I resonate with your value-investing philosophy, but, if you never sell, you never get income. All of your gains are unrealized. How can you live and pay the bills if you never sell? Thank you. Steve Tung
thanks for the question. This applies to the prudent saver who has accumulated enough capital so that the dividends from his portfolio support their lifestyle.. You don't have to sell because the dividend income is enough to live on. Therefore, other reasons to sell like discussed in the video should be implemented very judiciously if at all. Regards, Chuck
Mr. Chuck Carnevale - Can you give your public some insight into how to prepare and defend their hard earned assets in the face of looming inflationary onslaught expected from all this Central Bank and Fiscal stimuli (American and Foreign stimulus). Could you provide some examples regarding which sectors (companies) to avoid and which ones to invest in order to protect ones portfolio. Thanks for your help.
JEPA DelMonton: thanks for the question. My simple answer is to follow the principles of value investing as closely as possible especially the margin of safety. In his 1994 annual report for Berkshire Hathaway Warren Buffett offered a profound statement that I believe offers timeless wisdom. It was true then, I believe it is true now. Some of the facts have obviously changed, but the principles underpinning his lessons have not. Here it is: " We will continue to ignore political and economic forecasts which are an expensive distraction for many investors and businessmen. Thirty years ago, no one could have foreseen the huge expansion of the Vietnam War, wage and price controls, two oil shocks, the resignation of a president, the dissolution of the Soviet Union, a one-day drop in the Dow of 508 points, or treasury bill yields fluctuating between 2.8% and 17.4%. But surprise: None of these blockbuster events made even the slightest dent in Ben Graham's investment principles. Nor did they render unsound the negotiated purchases of fine businesses at sensible prices. Imagine the cost to us, if we had let a fear of unknowns cause us to defer or alter the deployment of capital. Indeed, we have usually made our best purchases when apprehensions about some macro event were at a peak. Fear is the foe of the faddist, but the friend of the fundamentalist." In short, all we can do is make the best investment decisions we can given the information we have available at the time. Regards, Chuck
imba: thanks for the question NBER does consider the Covid era as a recession. However, FRED has yet to officially declare it is one based on GDP. Also, the actual dates are not official yet. Consequently, not sure when and if we will add this as a recession, but my guess is we eventually will. Regards, Chuck
I have some of theese forever stocks.Most are in food Buisness or Healthcare.Like Starbucks,Smucker,Pfizer,Cisco etc. Hopefully i am right.Want to take them to the grave with me.But yea Chuck your right i also try to buy and really hold forever but stocks like AMT in my Depot, you never know exactly what is in 10 Years.
Apple trades at 22 times this year cashflow with the updated numbers just posted (a gigantic beat top and bottom), this without even discounting the enormous cash/cash equivalents on the balance and the 90BL buy back. If you think that valuation is too much you are out of your mind. If anything Apple is still cheap. It is up 50% since you sold it btw.
The only reason to buy a stock is to make a return on your investment. The only way to realize profits is to sell the stock. What the hell is a forever stock? I don’t get it.
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Thanks Chuck this helps a lot!
Especially after selling a stock with a nice profit last year, only to see the price quadruple afterwards.
But it wasn’t a „hold forever“ stock and I used my gains to reinvest the cash into other, fundamentally better businesses, so no hard feelings :)
I bought AAPL two splits ago, when it had fallen from ~$650 down to below $500. All the pundits were calling it a "sick" stock- but it was growing at >30% with a P/E of ~8! It was a great time to get in. I have >4 bagger now, and it is overvalued, but I don't want to dump this great co. My answer is to sell a few shares, IF I have another good place to invest the cash. In my case, it's other great cos. that have a higher and increasing dividend. That gives me more current income, and I still hold on to the bulk of APPL stock.
I bought Amazon for $23 in the 1990's. In March of 2000, I freaked out and sold it. I always think back to that sell decision. Dang!!!
Hardluck! Hope you found wise investments over the period.
Well you had plenty of time 2 repurchase it. It's mentally tough 2 repurchase a stock you sold too early. I now make exceptions sometimes for exceptional companies & re buy @higher prices. It's admitting you sold 2early or the narrative changed. MOST IMPORTANTLY DON'T lose $$$$. I'd rather miss an Amazon than lose my capital & have to start over.
Amazon is a unicorn. Nobody knew a book seller would be today what they are.
It's ok, I sold CMG at $70 30 shares in my wife's ROTH. And I told my dad to sell 37K worth of MSFT at $36 because it had done nothing much for 5 years. He bought VZ with that money, lol He's so mad at me. I told him to sell HBAN at $90 in 2007, just before the financial crisis in 08. He said his cost was $2 from 1972, (pre merger with other banks) so he wouldn't and he finally sold at $19 in 2008, it since spent a decade at 6-9,climbing to upper teens just this year.
Selling is many times more difficult than buying imho. Thanks for the video! I bought AAPL in 2012 and will not sell for over valuation reasons but with most companies I would
Perhaps the single most valuable nugget in this entire mother lode of timeless wisdom is @ 20:53, where Chuck observes "You really make your money on the buy side."
SO TRUE.
Embracing this deceptively simple yet pithy guidance and using it to inform all investment actions is the key to long term success. It's why, as Chuck asserts, "valuation matters and it matters a lot."
Buy low, sell high. Sounds simple, right? But when you truly follow the first part (buy low), you find the second part (sell high) becomes easier - if it ever comes at all - because buying at attractive valuation also buys enhanced margin of safety and increased leverage (through potential valuation expansion).
Thanks, Chuck, for yet another excellent and valuable presentation.
Chuck, I have been inspired by your words and videos for a relatively short time of several years and have benefited most times by your good counsel. However, this video was by far the best that you have presented. I already own ALL of the stocks you referred to in this video and have profited greatly already from each of them. As a result of your research I have today added to all of my positions. Please continue to make these videos and they represent a direction for any rational, reasonable, logical investor to follow. Thank you for all you do!
Thanks Chuck. I had Devon since 4 months and sold them making 6.5%. Was buying daily through Robin hood. Invested those in BMY. I am looking at PFG and PRU
Thanks, Chuck! One of the things I love about this channel is your heart to educate folks by listening and responding to our questions instead of "sticking to the script." I'm looking forward to more great content, but now I have to go brag to all my friends that I got a shout out on a RUclips channel with >20k subscribers. ;-)
Great analytical video as usual Chuck. 2017 and 2018 California wildfires caused by their equipment drove PG&E into bankruptcy. Thanks for saving one of my favorite holdings, PRU, for last.
I am trying to reduce my portfolio from 30 stocks to 20. I like them all, so I only sell to generate funds to purchase more shares of stocks that I already own.
We never go broke taking profits. Greed can wipe out many investors.
This isnt true, you can go broke if you make less on your winners then you lose on your losers. When in doubt: hold.
@@joeri2499 do you understand the word PROFITS? When I get a big run up I sell some because what goes up fast corrects and I get a better buy in price.
No need to shout, and yes I understand the word. Just pointing out a common misconception.
@@Rhino11111111 people buy for specific goals like education, home buying etc. Of course sane people sell great.companies to fulfill goals.
Hey Chuck, I really enjoy your videos and even as a financial professional I still learn from you watching these often. So, thank you for helping all of us. A big fan. Regarding the reason to sell has to do also with the opportunity cost. Which means that if you find another reasonably valued company with good earnings growth that is better than the existing position then that may be a good reason to sell and reposition. I think the return as it compares to an index is one of those things that should be a consideration as investors. I mean looking at some of these examples one could have feasibly held something like AAPL and then when it doubled sold off the cost basis to free up capital to invest in another value stock with good growth prospects thereby not having to get out of AAPL altogether and potentially holding the stock forever just redeploying some of your captial.
I prefer not to sell ALL of a winner, but I do like to trim some. If it drops, I'll buy some more. I sold some TSLA the end of January, and I just missed buying more in the higher 500s (my buy order was a bit lower). But I still have 80% of my TSLA position.
Chuck, as always good video!
Great insight. Hold if the thesis is still intact.
Awesome video almost reminds me of the book 100 baggers !
Great video as always!
I've been struggling with the decision whether or not to sell 1/2 my position in ETN. ETN, looks to be way overvalued. I've owned it for a number of years, but going forward it looks to me to be quite risky from a valuation standpoint. I could sell and redeploy into a stock paying much higher dividends.
Sometimes i was wrong i buyed Plug for 2$ and sold at 10$.Rebuyed at 15$ and saw my mistake to not sell at 60 or 70$.But still have the Position and plan to Risk hold forever.But very Speculative.But i want to see what is in 20 Years with that Investment.Still had make great money by the first buy and sell and now still up 88% after the rebuy.
When i think one of my stocks is overvalued i really like trailing stops. Yes its overvalued but when it falls no one knows. How tight you make it is up to you :). Do realize anything you own that is overvalued (IE popular) can become more overvalued.
RockTheCage55: of course I do, and I have spoken about it many times in past videos. Regards, Chuck
Eines der wichtigsten Videos des Jahres 2021. Dafür zahle ich auch gern ein ABO !
Better the time IN the market, than timING the market.
it's very difficult to timing growth stocks, so I prefer to stay IN and hold, and buy more in the dip, if the dip is not caused by a fundamental deterioration of the business.
Another great video. Question: When do you value a company based on operating cash flow vs earnings?
Aaron: Thanks. Actually, I always use both metrics and all the others on FAST Graphs when I am doing my research. As I often say about FAST Graphs, the tool does not dictate fair value it reveals it. I feel valuation is a puzzle and I utilize my "tool to think with" to help me make rational, and prudent decisions. Consequently, I utilize all the valuation tools at my disposal. Each metric provides its own insight that helps. regards, Chuck
@@FASTgraphs I was about to ask the same question.
Maybe an idea for a future video ? Which metric says what ?
P.S.: following your Channel every week, in the long run, educates us better than any university ever will. Thank you for what you do.
My dilemma was Mastercard (MA). I held for a number of years, but when it failed to make a new high and P/E was over 50 - I bailed. If MA had significantly dropped to maybe a 30 P/E, I would have bought back in - never has and has continued to go higher - sigh. I feel fortunate for my gains, but could not rationalize holding a stock I would not buy.
chuck, great video but I got one question left. If we take GEO or IBM, it often isn't clear that earnings will decline so it always looks like a proper value buy but in the retrospective, GEO and IBM were bad investments over last 5..6..7.. years (I consider this a long period of time) and It always looked like a turn around story, how can I avoid value traps and distinguish between great value buys and value traps...??
Mr International: I agree that 5, 6 and 7 years is a long time. However, it is not unusual. Regarding whether a stock is a value trap or not, nothing takes the place of comprehensive research and due diligence. Also, the real question is are the fundamentals fully deteriorating, is the company in transition, or are you seeing a temporary interruption in a strong business. Bottom line, I trust fundamentals more than price action. Regarding a situation like GEO group, politics have come into play. Nevertheless, the fundamentals continue to look adequate. Of course, the dividend cut suggests great risk.
As for IBM, I believe the jury is still out. I do consider it a turnaround story myself, as long as the dividend continues to grow I'm going to be patient. Nevertheless, we all have to make our own decisions based on the information as we see it. But, at the end of the day, continuous monitoring and comprehensive research and due diligence are the only answer to your question, and it doesn't always work out. like Peter Lynch said if you our right 6 times out of 10 you are good. You are never going to be right 9 times out of 10.Regards, Chuck
Great content, please Go ahead
Is your software cellphone friendly?
Steve: it can be used on the cell phone but it's not optimum. We plan on launching a mobile version in the future. Thanks for asking, Chuck
I gotta get your software!
Hi - is this the fastgraphs basic or fastgraphs pro? I'm really liking fastgraphs demos and thinking of subscribing but the pro is quite pricey. Thanks!
I have question 🙋♂️ you mention a lot about analysis on businesses that are mature with history but how do we evaluate new young emerging growth businesses that don’t have enough earning or fundamentals information available. I would love to hear your thoughts on this chuck 🙏
Jose: in my personal experience I have learned to be careful with young growth companies and IPOs. In many cases they turn out to be exceptional long-term investment opportunities. However, early hype often leads to irrational valuations, and price weakness host IPO. Consequently, patiently waiting until you either get earnings and other fundamental data most often leads to better entry prices.
However, with the above said, often price to sales becomes the only metric that makes any sense with early-stage companies. But, even then it's also important to recognize that much of what's going on is speculation. Anyway, you're not the 1st to ask so I have been working on a video, perhaps now is the time to launch it. Regards, Chuck
I resonate with your value-investing philosophy, but, if you never sell, you never get income. All of your gains are unrealized. How can you live and pay the bills if you never sell? Thank you.
Steve Tung
thanks for the question. This applies to the prudent saver who has accumulated enough capital so that the dividends from his portfolio support their lifestyle.. You don't have to sell because the dividend income is enough to live on. Therefore, other reasons to sell like discussed in the video should be implemented very judiciously if at all. Regards, Chuck
Real good!
What do you think about starbucks awful lot of debt - just for buying back stocks? In my opinion could lead to problems
Well, I just bought MMM 3M at $189 only a few shares, as a starter for my long term TOD account. Grrr before seeing this video.
Unless you live off the dividends.
Mr. Chuck Carnevale - Can you give your public some insight into how to prepare and defend their hard earned assets in the face of looming inflationary onslaught expected from all this Central Bank and Fiscal stimuli (American and Foreign stimulus). Could you provide some examples regarding which sectors (companies) to avoid and which ones to invest in order to protect ones portfolio. Thanks for your help.
JEPA DelMonton: thanks for the question. My simple answer is to follow the principles of value investing as closely as possible especially the margin of safety. In his 1994 annual report for Berkshire Hathaway Warren Buffett offered a profound statement that I believe offers timeless wisdom. It was true then, I believe it is true now. Some of the facts have obviously changed, but the principles underpinning his lessons have not. Here it is:
" We will continue to ignore political and economic forecasts which are an expensive distraction for many investors and businessmen. Thirty years ago, no one could have foreseen the huge expansion of the Vietnam War, wage and price controls, two oil shocks, the resignation of a president, the dissolution of the Soviet Union, a one-day drop in the Dow of 508 points, or treasury bill yields fluctuating between 2.8% and 17.4%. But surprise: None of these blockbuster events made even the slightest dent in Ben Graham's investment principles. Nor did they render unsound the negotiated purchases of fine businesses at sensible prices. Imagine the cost to us, if we had let a fear of unknowns cause us to defer or alter the deployment of capital. Indeed, we have usually made our best purchases when apprehensions about some macro event were at a peak. Fear is the foe of the faddist, but the friend of the fundamentalist."
In short, all we can do is make the best investment decisions we can given the information we have available at the time. Regards, Chuck
M" what if " does not help. I am looking for a portfolio for the future, not about the last. Thanks
Hi Chuck. The NBER says we're in a recession since March 2020. Why doesn't FAST Graphs show it on its graphs?
imba: thanks for the question NBER does consider the Covid era as a recession. However, FRED has yet to officially declare it is one based on GDP. Also, the actual dates are not official yet. Consequently, not sure when and if we will add this as a recession, but my guess is we eventually will. Regards, Chuck
I have some of theese forever stocks.Most are in food Buisness or Healthcare.Like Starbucks,Smucker,Pfizer,Cisco etc.
Hopefully i am right.Want to take them to the grave with me.But yea Chuck your right i also try to buy and really hold forever but stocks like AMT in my Depot, you never know exactly what is in 10 Years.
If only we could make trades in the middle of the graph...
Apple trades at 22 times this year cashflow with the updated numbers just posted (a gigantic beat top and bottom), this without even discounting the enormous cash/cash equivalents on the balance and the 90BL buy back.
If you think that valuation is too much you are out of your mind. If anything Apple is still cheap.
It is up 50% since you sold it btw.
The only reason to buy a stock is to make a return on your investment. The only way to realize profits is to sell the stock. What the hell is a forever stock? I don’t get it.
You really don`t know about the PG&E issues....they set fire to half california....
Chuck
CAREFUL SCAMMERS IN THE COMMENTS
Hopefully I have removed them all.