I think it's a major, and dangerous, fallacy propagated by Motley Fool, Peter Lynch, and others, that if the business is doing well, the stock must be a good investment
I haven't read Lynch in years, but I'm reasonably certain you've misunderstood him. Shrewd (or even moderately observant) investors don't deny that overall sentiment can change, causing a stock to fall despite a good underlying business. Most of them hold, however, that this isn't worth worrying about, since it's really hard to time such things (as many people refusing to invest in expensive tech stocks like MSFT, CSCO, in the early 90's found out). |
