Hi
For NSE sme stocks, corporate updates are not coming from past few days.
May please check.
Hi
Sorry about asking back to back questionsā¦
This is very basic again, and its about stock pickingā¦
Nestle and Tata Consumer:
Nestle has given significantly lesser returns than Tata Consumer since 2005, in 10 years and in last 5 years.
Nestle has a ROE of 150+% and Tata Consumer has a ROE of 10. Nestle makes more cash also.
Purely on fundamentals, a person would have gone for Nestle 10 years backā¦but look at the returns vis a vis TCPL !
Can some knowledgeable person throw light on such discrepancies? Why does this happen? Isnāt it supposed to be opposite of this?
Nestle and TCPL are just two examples, there are more such cases.
This is an interesting observation and a common point of discussion among investors. The discrepancy you highlighted, where a fundamentally stronger company (Nestle) delivers lower returns compared to a seemingly weaker one (Tata Consumer Products Limited, TCPL), can occur due to several factors. Hereās an analysis:
1. Valuation and Market Sentiment
ā¢ Nestle: Often trades at a high valuation (high P/E ratio), reflecting its strong fundamentals, consistent cash flow, and brand value. However, when a stock is already expensive, the scope for significant price appreciation is limited unless the business grows significantly faster than the market expects.
ā¢ Tata Consumer: Historically traded at lower valuations as it was perceived as a less mature or riskier business. However, if market sentiment changes due to growth prospects, restructuring, or diversification (as in TCPLās case), the stock can experience significant re-rating, resulting in higher returns.
2. Growth Prospects
ā¢ Nestle: As a mature company, its growth rate might be slower. It operates in a relatively saturated market, with limited room for exponential growth in its product categories.
ā¢ Tata Consumer: Underwent a transformation post-merger of Tata Chemicalsā consumer business. It expanded aggressively into newer product categories (beverages, packaged foods, etc.), tapping into fast-growing consumer segments and benefiting from higher growth potential.
3. Earnings Reinvestment vs. Dividends
ā¢ Nestle: With an ROE of 150%+, most of its profits are paid out as dividends, leaving less for reinvestment into the business. This limits compounding of earnings over time.
ā¢ Tata Consumer: Likely reinvested profits into expansion, acquisitions, and product development, leading to higher earnings growth over time.
4. Macroeconomic and Industry Factors
ā¢ Changing consumer preferences, demographic trends, and market opportunities can favor companies like TCPL, which are diversifying into healthier, organic, or premium products, while a staple-heavy portfolio like Nestleās may see limited excitement.
ā¢ TCPLās growth could also be driven by its focus on newer markets or segments like tea, coffee, and wellness products, which have seen a boom in recent years.
5. Management Strategy and Execution
ā¢ Nestle: Stable and steady management, focused on maintaining its leadership in core categories. However, this can also mean missed opportunities for aggressive expansion.
ā¢ Tata Consumer: Aggressive strategic decisions, including acquisitions, entering high-growth categories, and leveraging the Tata brand, could have driven its market perception and earnings growth.
6. Stock Price vs. Fundamentals Disconnect
ā¢ Fundamentals drive long-term performance, but stock prices in the short to medium term are influenced by narratives, market cycles, and liquidity. Sometimes, stocks like TCPL experience a growth story that excites the market, leading to over-performance compared to a steady performer like Nestle.
7. Base Effect and Scale
ā¢ Nestle is a large, well-established company, meaning its incremental growth (in percentage terms) will naturally be smaller. TCPL, starting from a smaller base, could grow faster due to the law of small numbers.
Key Takeaway:
The stock market rewards growth and potential, not just fundamentals. While Nestle is a rock-solid company with strong metrics, its slower growth and high valuation might not excite the market as much as TCPLās transformation and expansion story. This teaches us an important lesson in investing: fundamentals are crucial, but understanding growth drivers, market sentiment, and valuation is equally essential.
11 Likes
Please add a daily moving average of 100 days. Currently, there are 2 moving averages - one at 50 days and another at 200 days
2 Likes
Helloā¦ awaiting revert on this.
@kowshick_kk Is there feature that we can add column in watchlist for what is the last reported quarter, as in in results time if could see which companies has released results vs what all are pending, would be useful
1 Like
This would be a very useful feature while result season is in progress
A query where we can filter stocks based on price changes after latest results would be also useful to gauge the market reaction
Hi @Nitisha_Bohra Our team is focussing on developing fundamental related features like a Portfolio Tracking feature, Whatsapp alerts, and Better Industry classifications.
However, I have noted your requirement and will share the same with our team for consideration
1 Like
We have the ratio 'āLast Result Dateāā which shows the last reported results in āāYYYMMāā format.
You can add the above ratio as a column to track/filter companies that declared their quarterly results and vice versa.
2 Likes
Wow, that is what I was looking for, thanks
1 Like
Hi @kowshick_kk - Not sure if this is something that is written by anyone, can be bring one more variable for screener which is DMA < 20
For example : I needed something like this
Current price < DMA 20 < DMA 50 < DMA 200
However DMA 20 is not available.
2 Likes
Hi @kowshick_kk, In screener is something in query or column, in which If i want result of a particular quarter say Jan 2023 or June 2022, how do it get it ?
Hi, @kowshick_kk , Could you please provide a query parameter for āEPS during the 12 months preceding the latest quarterā alongside the EPS TTM parameter? This would help create the EPS TTM Growth ratio. Thank you in advance!
1 Like
@kowshick_kk Can we provide/add mid-year ROE also in the table below P&L. We already have mid year full FS of current year as well year last year, so this is possible. Would be easy to track mid-year performance.
1 Like
Hi again, @kowshick_kk. It would be helpful if you could add a query parameter for āOPM during the 12 months preceding the latest quarterā to be able to create the OPM TTM Growth ratio.
1 Like
Can I ask a question to a text box if provided by you guys in document section where I can ask like how many times has management delivered on guidance
If it answers from the available concalls till date
More possibilities awaiting if it can be provided
1 Like
For those who havenāt yet seen this, there is an extension suite Iāve released on the chrome and Firefox webstores that adds a lot of useful features to this already fabulous product (screener.in).
Please refer to the post below and if it helps, donāt forget to add a review on the product pages.
2 Likes
Hi @imurlovish
Screener is a fundamental oriented tool; thus, we have only limited technical indicators. Currently, we support 50 and 200-day Moving Averages on the website.
However, we are planning to add 20 Day Moving average as a ratio in the coming days.
3 Likes
Hi @hbhat79 Thanks for sharing your suggestion and the use case of it. I have noted it down and will share the same with our team for consideration.
2 Likes
Hi, @Khalidbashir1993 Our team is also working on such features through better AI integration to the website. With the help of advance AI, we will try to achieve such feature in the coming days.
3 Likes