RE: Stock performance. Do not anger the Goddess of the Stock Market, or she may hurl a bolt at EMC, which so far has managed to escape the market carnage relatively unscathed. Right now, the price of EMC is less than 8% below its 52-week high. Of how many of the other Big Boys in Techland can that be said?
Speaking quite seriously, the problem is that EMC is already selling at an awfully rich p/e of 131.6 (projected to fall to 70 next year, but still...). That, rather than the price of an individual share, would be what would give me pause, if I were thinking of buying right now. For that matter, it gave me pause when I actually did buy it, in January, when it was considerably cheaper.
True, up to mid-March, few people seemed to give a hoot about such old-fashioned things as p/e's, but valuation is getting more attention now.
Even the best of companies can be overpriced. For your edification & amusement, I offer two price analyses of EMC --one from Quicken.com, the other from Morningstar.com. The former concludes that the 'intrinsic value' of EMC is $31 a share; the latter's "business appraisal" comes up with a price of $27.50 a share.
quicken.com
quicktake.morningstar.com
Ridiculous? Of course, considering that folks will be prepared to pay a premium for a company like EMC. But how much of a premium? That's the real question -- unless you think the market is over its attack of indigestion, and is ready to party on as it did before. |
