New Construct report says 75 percent of big companies misstate earnings

Money Life with Chuck Jaffe

David Trainer, president of New Constructs, says that new research from the firm shows that three-quarters of the Standard and Poor's 500 stocks have misstated earnings, and that 215 of those companies have overstated their profits by more than 10 percent. He cites Fortive Corp., which shows reported earnings of $4.62 per share, but with core earnings of 99 cents per share; as a result, Trainer says the $74 stock has an economic book value of roughly $21 per share, making a fair value somewhere between those extremes. Also on the show, Jacob Channel of LendingTree on how many renters believe the housing market has priced them out, permanently, Lawrence Shapiro talks about his book 'When Bad Thinking Happens to Good People' and, in the Market Call, Kathy Boyle of Chapin Hill Advisors discusses ETF investing.