Eric,
What ever happened to this "hot tip".
"HERE'S A HOT TIP ON MUEI:
Sell now, when MU crashes MUEI will go with it."
MUEI has gone from 10 to 16 during the same time period that MU has dropped from 39-30. Apparantly, these stocks CAN behave indpendently.
MUEI is solid and is growing at an extremely fast pace. I agree with those who say that MU is not leveraging MUEI as good as they could be. Jerry, don't think that the traditional players (i.e. COMPAQ, etc) aren't keeping an eye on MUEI. GATE and DELL have already put a real hurt on COMPAQ, IBM, Pakard Bell, etc. MUEI is catching up in size to GATE and DELL. They are where GATE and DELL were about two years ago (and coming on fast). GATE, DELL, and MUEI are crushing the big boys and gaining market share.
As MUEI continues to grow it will continue to add to MU's bottom line. This fact seems to be overlooked. It has already gone from 5% to 10% to 15% of MU's bottom line over the past three years (note this is while MU's bottom line was growing at a very fast rate). I think many people are discounting the positive contribution MUEI will make to MU in the future.
MU is going through hard times right now, no question. It could get worse before it gets better (i.e. right now they are still making money, they could have some quarters of losses). This doesn't mean they are going out of business. IBM posted losses for a couple years before turning things around. The auto companies have been notorious for posting losses and have been rewarded when actual losses came in better than estimated losses.
My main point is this. MU is undervalued by any measure. Anyone who can read a balance sheet can recognize this. It will be very very interesting to see what MU trades at 2 years from now. I think 3x or 4x todays price is much more likely than 1/2x.
My thoughts for the day,
FF |
