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Technology Stocks : Is Intel a $100 stock next year
INTC 40.16-2.9%3:59 PM EDT

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To: damniseedemons who wrote (15)1/9/1996 2:02:00 AM
From: Ira Vine   of 58
 
You have to realize what is priced into each stock. Alcoa has a relatively low P/E because it is expected to deliver slow and steady performance. In fact, it was up a bit this year when aluminum prices climbed; but as the metal prices declined the stock price has slowly backed off. But investors figure they can still depend on a steady, albeit lower revenue stream for years to come. Tech stocks tend to price in geometric growth; when they come in with lower earnings investors have to dramatically change their perceptions. Hence the dramatic drop. The greater the reward the greater the risk; and vice versa.
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