Market Gems-Trading Strong Earnings Growth and Momentum Message Board

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Strategies & Market Trends : Market Gems-Trading Strong Earnings Growth and Momentum

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To: Jenna who wrote (771)	1/6/2001 8:29:51 PM
From: t2	Read Replies (1) of 6445

I looked at the revenue numbers and the market cap of a lot of companies that make up the BBH, and found that the market may not "tolerate" it. I believe a company like JDSU (which is in the optical segment) will sustain its growth rate but the market is not willing to reward it with a higher multiple--it may change as we head closer to earnings. Depends upon the forward looking guidance--which I believe will be just fine. To me it is a long term hold. However, biotech involves a lot speculation about the future and this market may/may not be ready for that. The earnings are unknown at this time unlike the optical sector. The other factor to consider about biotech is that it was a winning sector for 2000 and porfolio managers were less likely to sell the winners at year end. No tax loss factors to consider. Same applies to a lot of tech stocks like Ciena, AMCC, JNPR that were winners in 2000---they seem to be going down early in the year in a big way. On the other hand, telco and wireless carriers like PCS, AWE, T, FON are moving higher--as they were tax loss candidates last year.

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