This month has been bad for many top stocks, and the reason is 2015 profit growth looks to me slowing into the teens.To me teens profit growth leads to teens stock growth, and that’s not good enough. Stocks like Google (GOOGL), Priceline (PCLN) and Michael Kors (KORS) got hit during the last month, and no longer have the look I like to see in my top holdings.
I still like these stocks, its just that the stocks might not give us 40% compounded annual returns like they used to.Other big names that got hit last month due to estimates falling are Yelp (YELP), Twitter (TWTR) & Netflix (NFLX), but those stocks have an average P/E of 112 and needed to fall. LinkedIn’s (LNKD) estimates rose and the stock went up, but you have to pay 79x EPS for 35% growth. Too much.
