Creative Labs (CREAF) Message Board

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Technology Stocks : Creative Labs (CREAF)

CREAF 0.448

-4.6%

Dec 17 12:59 PM EST

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To: Jon Tara who wrote (4275)	10/18/1997 5:39:00 PM
From: Dennis G.	of 13925

If CREAF was to drop to 18 that would be another 22% loss and be trading at a forward multiple of 7 1/2. If the Nasdaq was to drop that much it would be at 1300 and if the Dow were to follow suit it would be at 6000. Do you see that happening too? If so it would not be a correction, it would be a bear market crash. Why should the market crash in the absense of inflation or rising interest rates? If not, then why should CREAF underperform the market? Does their upcoming earnings report mean nothing? Is the chart the only thing you're looking at? If you look at the semi-equip sector, you'd see it has been the best performing group in the whole market by far this year. And in the way the market usually does, they overdid it and drove many up to excessive valuations. What makes you think this is not just a healthy and necessary correction in that group? I just checked that group and there were no 10 point losers. There were only a handful over 10%. The worst performer in that group Friday on a percentage basis was ASYT, down 15.5% But if you look at its chart you'll see its gone from 7 1/2 to 48 this year, a 640% gain. Don't you think that was a little extreme and a pull-back was in order? (I wish CREAF had gotten some of that excessive enthusiasm.) Now ASYT is at 29 and a forward P/E of 21. Looks actually like a good buy right now. I bet it doesn't stay down there very long. I've also noticed that Intel, which started this downdraft with its near miss, hasn't really suffered that much. And Microsoft hasn't even been touched. Do you see them selling off big time? Most of the money in this market is in mutual funds and they don't sell big time unless they get redemptions exceeding inflows. They're the only ones who can take the market down that far. But inflows show no sign of slowing down and in fact people are now conditioned to buy on dips, because that is the best strategy. I expect that to continue. Dennis

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