AAP Podcast #31 – Prepping for the March CPI, Bank Earnings, and talking stock valuation tools.

We are coming at you a day earlier than usual with this week’s AAP Podcast so Chris Versace, lead portfolio of TheStreet's Action Alerts Plus, and Todd Campbell, editor of TheStreet Smarts, can prepare you for the March Consumer Price Index report and its implications for the market as well as monetary policy. Chris and Todd discuss not only the consensus forecast of +5.6% year over year for core March CPI but also delve into what the Cleveland Fed Inflation Nowcasting model sees ahead for April for both the CPI and the Personal Consumption Expenditure (PCE) index. The short of it is neither points to meaningful progress on inflation, which as Todd and Chris discuss has a long way to go to the Fed’s 2% target. The bottom line is the March CPI report has the potential for the market to begin re-thinking the rate cuts it sees per the CME FedWatch Tool.

The two then move to talk about what they will be watching as bank earnings start to roll in and then move into discussing several stock valuation tools they use. From when and how to use the price to earnings (P/E) metric as well as some of its shortcomings to other tools ranging from price to sales, dividend yield, and enterprise value to revenue. You’ll also hear why Todd isn’t a fan of using EBITDA, as well as what one of his go-to valuation metrics is. Chris and Todd recap some rules of thumb you’ll want to factor into your thinking and share why you need to listen to math.