George Dawson: Okay, here's one that might fit our OT discussion. AT&T.
T is near its low. It's being written up in the media both as a has-been stock that will never come back, one whose basic business (long distance) may even completely disappear (with free internet phone service?), or else that T is undervalued based on the sum of its parts.
How might somebody dissect T? The business is so complicated- you got staid stuff, financial whiz Malone, cable company, phone, business services, etc. etc.
One reasonable approach, imo, for the average investor considering T now, is to say, forget it and move on.
Of course, somebody could start a very detailed analysis of all the parts and the ramifications of the proposed deals that the media suggests, etc. etc. I don't believe that's reasonable (I'm not sure though- imo, T stock is not likely to go up five fold, but if somebody was so darn confident of their analysis and bet a big chunk of money say on a 50% rise in 6 months (too risky for me)that would justify the time spent in the detailed analysis.)
By my way of operating and my way of investing, my opinion is that - in this particular instance - an investor reading the newspaper, following what's going on, seeing the potential ways that value could be realized, seeing T as a wounded elephant (dinosaur?), but still an elephant, seeing the stock price at multiyear low --- you have as much information as you need at this point to make (or refrain from) an investment.
Paul S. |
