Question for Saul re 1YPEG and CBM

I have been looking at CBM, and this morning I calculated its 1YPEG:

Trailing PE of 23.13 divided by end of trailing earnings growth of -1.65 = 21.48.

Is this correct? If so, it looks like a stock I would want no part of!

Am I missing something here?




It helps if you show your work if you’re looking for confirmation that you did it right. For instance, if you wanted to ask if I calculated FB’s 1YPEG correctly, I would show my work like this:

Revenue (billions)	Q1		Q2		Q3		Q4
2013			1.458		1.813		2.016		2.585
2014			2.502		2.910		3.203		3.851
2015			3.543		4.042		4.501		5.841

EPS (non-GAAP)	        Q1		Q2		Q3		Q4
2013			0.12		0.19		0.27		0.32
2014			0.35		0.43		0.43		0.54
2015			0.42		0.50		0.57		0.79

(2015 Q4 Earnings):

Revenue Growth (billions)
2014 Q4 TTM Revenue = 12.466
2015 Q4 TTM Revenue = 17.927
Year Over Year Revenue Growth = 43.8%, previously 42.29%,

EPS Growth (non-GAAP)
2014 Q4 TTM Earnings = 1.75
2015 Q4 TTM Earnings = 2.28
Year Over Year EPS Growth = 30.29%, previously 32.7%%

P/E = (Check Current Price) 94.45/2.28 = 41.42

1YPEG = 41.42/30.29 = 1.37

Note: This isn’t updated for correct, price, P/E, YPEG, etc. It was last calculated right after their last earnings report. I’m just trying to use this as an example of how you can show your work to let others check it.

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Thanks Matt. I appreciate your response.

What I was trying to get at, though, is why Saul apparently still likes (or at least still owns) CBM when it had what looks like a really bad end of 2015, and 1 1YPEG that looks completely out of whack.

Matt, in thinking about your response above again, I realized that I did make a mistake in my calculations, because I only used the 4th quarter earnings in my calculations, i.e.- i didn’t include the entire year.

Thanks again.

And, having realized your error, the new answer is … ?

Hi Speedy,

For CBM I take the adjusted earnings right off the press releases. For example, from the most recent Dec quarter:

Adjusted income from continuing operations was $33.0 million or $1.01 per share, compared to $20.4 million or $0.64 per share in the same period last year

What I have for 2014 was 06 + 35 + 28 + 64 = $1.33

What I have for 2015 was 29 + 63 + 40 + 101 = $2.33

(Note that the 1st and 3rd quarters seemed lower each year, implying a definite seasonality).

Now for PE we have 40.75 divided by 2.33 = 17.5

For rate of growth we have 233 divided by 133 = 1.75, so 75%.

I would expect that the rate of growth for 2016 will come down to 50% or even lower. But with a PE of 17.5 we seem pretty safe.



Thanks Saul.

One thing that threw me is that on Yahoo Finance, it is showing the current PE as 23.13, while you have it (above) as 40.75. Where should I be looking for the PE (I am assuming Yahoo Finance is not correct)?

Saul, I just realized I misspoke in my message above…i jumbled my numbers again. I should have finished my cup of coffee before responding!

Thanks again for the information.


I finished my coffee, and looked at your numbers again.
The 1YPEG calculates to .306, correct?

ie- the 1 year trailing PE (17.5) divided by the rate of growth (1.75%)
= .306

Sorry to bother you again with this, but I want to make sure I am calculating the 1YPEG correctly.

Thanks so much.

Hi Speedy, you need to read these things better.

I clearly showed that the rate of growth was 75%. Thus a 1 yr forward PEG would be 17.5 divided by 75, which comes to 0.23.