Stock Attack II - A Complete Analysis Message Board

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Strategies & Market Trends : Stock Attack II - A Complete Analysis

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To: The Freep who wrote (34025)	4/10/2002 12:43:56 PM
From: Paul Shread	Read Replies (1) of 52237

Freep, That's based on a fairly complex formula that tries to calculate a stock's 10-year historical trading range using ROE, book value and some other measures (pages 68-69 in Trouncing the Dow). Right now for AMAT, the current range is about $2-$6. It doesn't mean the stock will ever get anywhere near that, however. I have some reservations about applying it to deep cyclicals because they tend to bottom when the fundamentals are the worst. GM, for example, should be about a $14 stock right now by the method. All FWIW. It's kept me out of a lot of trouble over the last couple of years and tells me when it might be time to begin to accumulate in a sector. And right now it says the semis are wildly overvalued (big duh there). Paul

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