Invesco Canada blog

Insights, commentary and investing expertise

When valuing businesses, cash flows matter more than forward multiples


July 16, 2020
Subject | Active management

During a recent webinar, I was asked whether we have enough real data to see what forward P/E multiples look like, or whether the market is just ‘guessing.’ This is an interesting question that highlights a very important point when it comes to valuing businesses.  It highlights the danger of using forward multiples to evaluate long term intrinsic value1.  Significant business disruption, either as a result of the current pandemic or an abrupt downturn leading to a recession (think Global Financial Crisis) can significantly impact forward P/Es.  However, these events do not have the same impact on the intrinsic value of a high-quality business.  The key distinction is that forward P/Es rely on one year of earnings while a company’s intrinsic value is a function of all of its future cash flows.

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Video: Perspective on global equity sell-off

Given the high level of volatility and the recent market selloffs, we thought it would be helpful to provide our perspective on what we have seen in Global Equity markets in February, March, impact on portfolio and what our outlook is.

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Why I focus on quality dividends


July 22, 2019
Subject

The October 2018 sell-off in global markets has several underlying factors, but the most commonly cited reasons are the rise in U.S. 10-year Treasury yield, concerns on earnings growth and the overall level of valuations.

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A foundational approach to managing risk


June 12, 2019
Subject | Active management | Invesco

According to Plato’s account of his mentor’s trial, Socrates stated “The unexamined life is not worth living.” I think this is a pretty good motto, so I spent the past nine months reviewing and evaluating my investment process to ensure that I haven’t picked up any bad investment habits.

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The value of field research


July 27, 2018
Subject

One of the things I’m often asked about is the amount of research travel that we on the Global Equities team undertake. It may sound glamorous to be on a research trip to Europe, but it’s actually pretty exhausting.

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Healthcare stocks in the age of Obamacare


October 16, 2013
Subject | Active management | Macro views

While the U.S. federal government shutdown* continues to dominate media headlines, the Patient Protection and Affordable Care Act – better known as “Obamacare” – is likely to survive, even though a Republican-controlled House of Representatives vehemently opposes it.

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Questions about global investing? Join us for a live webcast this Wednesday


June 17, 2013
Subject | Active management

This Wednesday, I’m getting together with my colleagues Jeff Feng and Virginia Au for a live conversation and advisor Q&A. During the webcast, we’ll cover various topics around global investing and you’ll have an opportunity to ask questions.

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