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Strategies & Market Trends : Don't Drink the Kool-Aid Kids

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To: Stoctrash who wrote (212)3/30/2001 9:56:51 AM
From: Rarebird  Read Replies (1) of 1063
 
Here's a bullish argument for AMD on a nice pullback: AMD makes computer chips for PC clones, especially for the cheaper machines. If we do have a prolonged recession, consumers are likely to use the internet more often, not less, as it is a cheap form of entertainment and communication, and the $1500 computers with their chips are likely to sell much more than the $3000 computers with Intel chips. Moreover, AMD has had a profit growth averaging 12% over the past five years, while its P/E ratio is only about 9, yielding a profit-growth-to-P/E of 3:2. If this ratio can get back down again to 2:1, as it did in January, I'm a buyer of the shares.

Grrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrowl!
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