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EPS EPS, Where Have You Been?

We are in the midst of the “earnings season” and the barrage of company press releases, conference calls, and analyst meets.

Stock market analysts all over the country currently have their noses buried in quarterly statements, hoping to get a sense of company-specific and industry trends.

If their habit hasn’t changed since I left the industry two years back, most of them will be taking up management teams’ time by questions that serve no other purpose than to help them (the analysts) forecast the next quarter’s earnings per share…or EPS.

Old habit die hard. So even I’m trying to get back my focus on my old friend EPS, that continues to act oddly amidst slowdown across industries.

Here is a rhyme I’ve penned down on EPS. This is what happens when you spend weekend time with your kid and her books, and also reading through some quarterly results (most of which tell a sad story as far as EPS is concerned).

Here I go….

A rhyme on EPS
EPS EPS, where have you been?
I’ve been through a hammering,
A slowdown unseen.

EPS EPS, what did you there?
I frightened my owner hiding under the chair.

EPS EPS, when’ll you get in shape?
I dunno, but please don’t believe the ticker tape.

Ticker tape? What do you mean?
I mean the stock prices, which are all in the green.

So are stock prices lying?
Even as you’re crying?
I think they’re on steroids,
Just ‘cos free cash is flying.

EPS EPS, I miss you so much,
Please come out of the bear clutch.
Yes, I’ll come out, but I’ll be slow,
Now can you please focus on the cash flow?

But you’re the king,
With you the analysts cling.
Oh, I know that foolish truth,
But don’t believe that thing.

I can be ‘worked’,
So you can be jerked,
Avoid reading much into me,
Or you will be irked.

So what should I do?
I still love you.
You see, love is blind,
It hurts your pocket and also your mind.

See, I know you deeply love me,
But in bad weather, I can easily flee.
Those who know me know I’m not so nice,
So don’t bet on me, or you will pay a heavy price.

Get over your myopia,
And buy where there is cash.
Or you will be sorry,
To see your savings in trash.

I’m just a mirage,
Cash is the real king.
If you don’t focus there,
You’ll feel a nasty sting.

Yes I’m popular,
But I’m not the best.
So please don’t love me,
It’s my sincere request.

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About the Author

Vishal Khandelwal is the founder of Safal Niveshak. He works with small investors to help them become smart and independent in their stock market investing decisions. He is a SEBI registered Research Analyst. Connect with Vishal on Twitter.

Comments

  1. Vishal, your crystal clear thinking shines bright through your posts. This one is another masterpiece.

    Thanks for sharing!

  2. Reni George says:

    Hi Vishal

    Good Morning to you and Fellow Tribesman

    Hahahhahhahh…..
    EPS…EPS where have you been….its long time you have been seen….
    The mask of free money covering the EPS….
    In Hindi…..I would pen something like this

    “Kitne saawan beet gaye…meri pyaasi naina taras gaye”
    “Ye bhai zara dekh ke chalon…..aage bhi nahin,pechi bhi
    daayein bhi nahi,baayeib bhi…..bus free cash flow,free cash flow”

    Thanks and Regards

    Happy Investing
    Reni George

  3. Akbar Khan says:

    Hi Vishal,

    Loved it. Reminds me of:
    Mai shayar to nahi magar ai haseen ( EPS )
    Jab se dekha tumko muzhko sayari aa gayi

    Best regards,
    Akbar

  4. R.K.Chandrashekar says:

    Vishal
    You have done poetic justice to EPS and crowned cash as the King- very true!! It also shows that you are a multifaceted personality.

  5. good writers are indeed good poets too. all the best and keep rocking. Tx

  6. Part hilarious and part honest. A good compilation.

  7. Novice Investor says:

    Dear Mr. Vishal Khandelwal,
    I have been reading this website religiously over the last year or so. I have noticed that you give a lot of fundas. Most of the fundas that you give are well intentioned and good. But it would be better if you spent more time analyzing industries, companies and stocks. That would help the broader audience more than just fundas and gyan in terms of what should one do and what should one not do.
    Regards

    • Dear Novice Investor, all I write here is with the intention of helping my readers learn what I am learning myself from the legendary investors. So never have I said that these are “my” fundas.

      Also, it’s not that I don’t analyze companies. My idea is always to teach people to fish for themselves, and thus there are more fundas than research reports.

      Please also understand that a lot of my readers still need to know and learn these fundas before getting down to actual stock analysis. They first need to know how to behave well before even touching an annual report.

      Anyways, please let me know your specific suggestions on what you want to read, here.

  8. I agree with Novice Investors, fundas sound good from somebody who has a tangible track record in the stock market like (Warren Buffett, Charlie Munger, Sanjay Bakshi, Rakesh Jhunjhunwala). Other lesser mortals should try do more grounded analysis on companies, rather than giving fundas

    • Dear Tiwariji, please see my reply to Novice Investor’s comment above.

      Good investment behaviour comes first, analysis later…although I am trying to cover both here on Safal Niveshak.

      This lesser mortal has learned it this way. 🙂

      Thanks anyways for your feedback.

      • Hi Vishal, with respect to comments from Novice Investor and Tiwariji, here is what I read a few days back…

        “It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”

        You are the “man in the arena”. So pleeeeeeaaase keep doing the great work you are doing is helping us “novice” investors. Cheers!

        • Thanks for sharing this Anand! 🙂

          You won’t believe but I just received (from another tribesman) the 1910 speech from Theodore Roosevelt where he says what you have quoted above! Regards.

  9. finished reading AS 20 in class today.
    ….. this poem became more apt in that context ;D cheers !

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