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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 659.03

+1.0%

Nov 21 4:00 PM EST

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To: American Spirit who wrote (79593)	7/7/2001 1:07:21 AM
From: Robert New	Read Replies (3) of 99985

Cant believe you bought EMC today on the magnitude of this warning. Given that the stock closed right at the lows of the day indicates that we'll see further downside on monday. Just a few weeks ago EMC was seeing firming in orders...what happened to that? Obviously few ceo's have visibility in this market. We are still seeing the fallout from the boom/bust cycle in tech at large. Given the current estimate of .05 for the quarter for EMC lets run a quick calculation. Extend this out for 4 qtrs which I admit is crude but you come up with a P/E of 108 based on the current price of $21.60. Now factor in that we are seeing a huge contraction in the earnings trend and this may be overly optimistic. Couple this with the fact that EMC is slashing prices (take a look at that big drop in margins) and it doesnt add up to a quick turnaround in my opinion. I prefer to let the dust settle and sift through the wreckage at that point. Time will tell as always...

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