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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: Mike Buckley who wrote (42326)5/2/2001 2:40:21 PM
From: BirdDog  Read Replies (3) of 54805
 
...keep such issues about valuation at the forefront

May I discuss this with you in the context of your "Ruleof5" peg ratio?

If so... would the rule be another absolute? Or would other factors be taken into account?

Fact One) The market tries to invest ahead of the news. Right now looks bad, and everyone knows it. But forward looking in the next 6 months looks great.
Fact Two) The p/e is due mainly to analyst's estimates.
Fact Three) The stock price is way below any recent highs.
Fact Four) We're just barely comming out of the bottom of a huge drop in the market.
Fact Five) GS just took the second suprise rate cut in 4 months. The fed appears to be on a sustained cutting spree. This just keeps helping the economy and this company's market.

In other words.... This present situation might not warrant selling sebl with a peg of 5? I have to admit. I would expect selling at such a peg when the company is at it's all time high and can't see an increase in present growth rate for months or perhaps ever.

BirdDog
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