Bob Brinker: Market Savant & Radio Host Message Board

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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: sea_biscuit who wrote (2267)	12/2/1997 4:19:00 PM
From: Kirk ©	Read Replies (1) of 42834

Can you dig up any material (other than those lessons, of course) from the fools that can help you dissuade your clients from astronomical P-E stocks like MSFT or ORCL? I very much doubt if you can. I love a challenge! Only took me 5 minutes too! 8) 208.206.41.243 Here the fools discuss MSFT's lofty valuation and offer an explaination as to why it and Dell are getting such high valuations. I have been researching this in other sites and many say that P/E is a poor way to value MSFT and DELL( to name a few) and the astute investor uses ROE (and cash flow) and the even smarter investor looks at EVA. Maybe they aren't saying "don't buy it", but they try to explain the lofty valuations in the face of their PEG model that otherwise says short MSFT and DELL. You will note that neither Bob or the Fools have suggested selling or shorting MSFT unless you have too large a percentage of your portfolio in it. On the other hand, Bob was strongly hinting at a short of KO at $72. The Fools give a reasonable explaination in a few lines of why KO should not get the same valuation as MSFT. BTW, I am not a follower of the fools and am just defending them because I don't think they deserved as much of the bad words they were getting here. Then again, I don't follow Bob 100% either....I only go 12% international feeling my high tech's had great international exposure and more than enough risk and diversity and have far outperformed the S&P500 so far thus I've been happy with my weighting. I do believe that Bob's discussion of the market, timing and some technical stocks are unmatched and I've made wonderful use of his advice. suite101.com regards Kirk out

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