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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (20498)	1/21/2005 12:15:43 AM
From: E_K_S	Read Replies (2) of 78670

Hi Spekulatius - I like the E-Bay model and their margins are quite high but the value play is just not there. Maybe at $40 I will invest. I am a bit disappointed in E-Bay as they raised their "final value" fee from 3.5% to 8% effective February 2005. This will drive a lot of the active sellers to other auction sites. I am looking at Overstock.com's auction site. It currently does not have the same activity as E-Bay and their overall auction web site is not as developed as E-Bay but with a bit of IT development and $'s, they just may be able to capture a huge segment of this market. Their final value fees are only 2.5%. When you are an active seller, this mean large dollar savings. What's your take on Overstock.com (http://finance.yahoo.com/q/bc?t=2y&s=OSTK&l=on&z=m&q=l&c=ebay). My under valued semiconductor play is LSI. They are trading close to book (but still have quite of bit of goodwill write downs). Two of their product divisions are doing quite well; storage and VOIP ASIC chips. This is one value play that IMO has a good risk/reward. I also have an investment in BRCD (over three years). They have over $3.00 cash and excellent free flow cash flow. My average cost is around $5.00 but I am waiting for BRCD to become a teenager. I think fair value is around $12.00-$14.00 if they can participate in the SAN storage growth. Rather than investing in QCOLM, I been a buyer of NOKIA at prices around $12-$13. It was downgraded today which provides an excellent entry point for new buyers at current levels. They pay an annual dividend in April (almost 3%) and NOK is a market leader with over 30% of the market. Management has shown that they can bring out new products in an ever changing market. Also, it's a foreign currency play if you think the dollar continues to be weak against the Euro. This is the "value" play stock in this segment as they pay a dividend and have quite a bit of cash on their balance sheet. Finally, I like your call on Agiliant. It's not really a value play but for the many years that I have followed the company any price in this range (even below $20) is a buy IMO. Agilant has many new emerging technologies in both the Nano tech and Bio Tech fields that are very interesting. I am looking to sell the August $20 A PUT for $1.40. My earlier buys in 2003 allowed me to establish a position below $20. I can recall this stock was trading well above $40 when their semi conductor business was doing well. Their earnings do jump around so PE is not a very good indicator of potential value. Book value is around $7 and they have very little debt. It's all in their new products and emerging technologies. They have proven that they have the "brain" power to develop new leading technologies and bring them to market. Five years out, I believe we see a double with the stock trading around $45. EKS

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