Another example is that an investment in Intel on November 12, 1997, and held until today would have underperformed an investment in an S&P 500 index fund by 15%.
Intel was one of my first major scores. I bought in "95 and got out in '98 for a 2 & 1/2 bagger. (I bought AOL, and some more Dell, with those bucks. Hey, I can't be wrong all the time!) I know I missed a good move, but I still did better with other stocks.
The secret here, is that the story changed! My opinion at the time was that the plunging prices on PC's were going to drive down Intel's margins, and that the stock was not going to do as well as it had.
On Microsoft and Cisco, I don't see a story change. Softy is being held down by the DOJ, and Cisco by the market's belief that they can't hold their margins. But, both companies are still turning out tremendous results, and deserve better stock prices. "Earnings will out", dammit, and they are due for a double in the next 12 months.
In fact, I attribute a lot of the whole tech "blahs" to the DOJ. "As Microsoft goes, so goes tech", to a large degree. |
