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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium
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To: TimF who wrote (107968)4/26/2001 7:01:42 PM
From: If only I'd held  Read Replies (1) of 108040
 
Talking valuations with Fred is not going to work. He is a momentum trader. Most of the people I come across on SI don't seem to realize how much 12 billion (with a B) is. Compaq bought DEC for about 9 billion dollars a couple years ago and that was unheard of for a tech company. As a result, CPQ has been dead money ever since. It's one thing to swap overvalued stock certificates for overvalued, and it is another to come up with the cold hard cash. Nobody in their right mind would pay more than 2-3 billion dollars for EBAY with cold hard cash. And I have to think any aquiring company that would pay for it with stock would be hammered for the move. Sooo, it's worth roughly 1/5 what it trades for in my book. That leaves it overvalued by a big margin. Stocks are worth the paper they are printed on. In the end, it's the cold hard cash real money that counts.

Oh yeah, Ford and GM were insanely overvalued for a time there before the big crash. It took a long time to get back to those valuations, but they did. The thought of having to take that temporary beating should be enough to scare any investor with 1/2 a brain away from EBAY. EBAY isn't even an interesting speculation anymore.

That is all just my opinion though.
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