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Technology Stocks : Nortel Networks (NT)

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To: KYA27 who wrote (2008)2/12/1999 11:56:00 AM
From: mauser96   of 14638
 
I suggest that you take a look at LU vs. NT relative strength. NT has shown consistent stronger performance ever since the October lows, also recently. One thing that I have learned from years of investing is that today's media prince (LU)becomes tomorrow's frog at the slightest sign of earnings or revenue problem.The big thing going against LU in the long run is that the miserably small difference between cost of capital and return on capital, only 0.6 percentage points. A real growth company is much higher (for instance MSFT has a gap of 38.7 percentage points) See Fortune Magazine 11/9/98. Read Warren Buffett to learn the importance of this.
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