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Pastimes : AMAT Off-Topic Forum
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To: Sam Citron who wrote (564)2/5/2002 12:11:11 PM
From: runes  Read Replies (1) of 786
 
Sam - A thousand apologies for ever bringing up ELN

Boy have they taken it on the chin! I realized going in that there was risk involved but I never expected it to drop below $20. It is now at 20% of it's high of 6 months ago, trades at 1.5 times book value, a PE of 8.
...And all of that for a company which still has legitimate earnings from real and growing products and 2.4 bil in cash and equivalents.
...The only dark side I see is the two off-balance sheet investments that appear to have cost $1.50 in '00 earnings and $0.50 in '01 earnings. That seems steep but the trend is in the right direction.

I still have some homework to do (listen to the CC and read the recent spate of news) but I don't see anything to justify the current price.

For What It's Worth - (and I suspect that you already know this) - this kind of rollercoaster is usually driven by gross over-reaction to events. My latest one of these was AVNT which tanked to $11 after pleading no contest to criminal theft of IP, hit 7 after CEO resigned due to health reasons, 5 after shareholder lawsuit, 3 after 911. Then went back to $10 after paying off the criminal fines and then $20 after SNPS made a buyout offer. Throughout all of this they stayed on track for $2/year in earnings.
...And I made more than enough to pay for all the Pepto-Bismo.

...Feel free to chew on me if you feel the need. For myself - I plan to finish doing my homework and then probably double down and hoold for at least 3 months. My operating theory here is that the stock will recover to $20 as long as the next quarter's results meet expectations.
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