The forward P/E of ~26 in my example isn’t a typo—it reflects my methodology for “normalizing” valuations over a longer horizon.
Many published forward P/E figures (in the 32–34 range) are based on current 12‑month estimates, which can be influenced by short‑term factors and analyst optimism.
In my model, I smooth out those fluctuations using historical trends and adjust for expected EPS growth, which often yields a lower “normalized” forward P/E that helps me gauge a margin of safety over a 5‑year period.
This approach isn’t uncommon among long‑term investors—it’s more about setting a framework for potential returns rather than quoting a point‑in‑time statistic.
That said, I appreciate your diligence and always recommend comparing multiple sources and methods.
with all due respect, where do you get Apple’s forward PE at 26? every reliable site i researched has it as 32-34. thank you
Hi Tomy,
The forward P/E of ~26 in my example isn’t a typo—it reflects my methodology for “normalizing” valuations over a longer horizon.
Many published forward P/E figures (in the 32–34 range) are based on current 12‑month estimates, which can be influenced by short‑term factors and analyst optimism.
In my model, I smooth out those fluctuations using historical trends and adjust for expected EPS growth, which often yields a lower “normalized” forward P/E that helps me gauge a margin of safety over a 5‑year period.
This approach isn’t uncommon among long‑term investors—it’s more about setting a framework for potential returns rather than quoting a point‑in‑time statistic.
That said, I appreciate your diligence and always recommend comparing multiple sources and methods.
Hope this helps clarify things.
Cheers