You are never going to find companies like Titan, Pidilite and Nestle undervalued (with a big margin of safety).
So what’s the best thing you can do?
Buy them at a fair price!
But How?
Step 1: Look at the weekly chart of Nestle (for example)
Step 2: Apply a 200 EMA on that chart. (You should have each data point streched to about 4 years)
Right now, 200 EMA is at 16,583.42 (implied fair value) while the stock price is at 19,021.50
Step 3: Wait and try to buy it lower the 200 EMA.
(Note: In theory, it’s called efficient market approach. Please be aware to only use this approach with stable growing companies with no big price jumps like Titan, Pidilite, Nestle etc)
I believe, PE ratios will never work out on the companies you are after. So the best you can do is use some technical analysis to come with with a fair value. It’s a slight variation of efficient market approach.
Hope this helps!
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