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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (24160)	7/8/2006 1:59:30 AM
From: Spekulatius	Read Replies (2) of 78702

Large cap tech is cheap nowadays. I own EBAY, MXIM EMC and ADI (bought today). All those stocks have strong balance sheets with substantial cash on hand. For example ADI does not look that cheap on a PE basis, but if one subtracts the 7.2$ in net cash to get to the EV value (around 23$/share), the forward PE for 2007 is <12. the company may be involved in the backdating scandal but i think the financial fallout from this will be small. In the meantime, the company is increasing it's dividend (Yielding 2%), option grants have been falling substantially and the current accounting rules overstate financial expense from option grants anyways. So unless the semiconductor market falls apart, ADI (as well as MXIM) is a pretty cheap stock, IMO. Another tech stock i would consider a good value is AMAT, but i do not own a position yet.

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