>>A momentum investor will never discuss valuation.
Enough, Bill.
I've gone to considerable lengths to explain why I think Yahoo is worthy of your dreaded $3 billion market cap, and all you seem to do is compare Yahoo to a host of broken angels and prophesy doom for the stock price. Now you're trying to simplisticly pigeon-hole me as some irresponsible momentum investor who refuses to see the "truth" as defined by Bill Wexler.
There was a time not long ago you were raising red flags that Yahoo had passed $1 billion market cap. Then $2 billion. Now $3 billion. Early arguments were that knowledgeable insiders were dumping. Then it was never-proven claims of declining ad rates. Then it was a supposed slowdown of Internet advertising spending. You've thrown enough mud into this thread to sink a freighter, yet Yahoo closed at a record high today. All along you short the stock heroically as the price continues to move against you. Today you buy out-of-the-money puts with 10 days' life. The worst market correction in seven years just ended, yet your dire predictions haven't come true for this stock. All you can say lately is that they will. No insight, no corroboration, nothing but Chicken-Little predictions based on the fact that Yahoo commands a big valuation.
Had one taken your advice for the last six months they would have lost their shirt.
Maybe your "appropriate" valuation model doesn't square here, but it's a fact that the 25 best-performing stocks from 1991-1996 sold at a mean 100x forward earnings estimates during those five years, yet on-average increased in value by 1,600% during that period. As long as interest rates stay calm, it can happen again.
So instead of slamming momentum investing, predicting doom, and losing a ton of money, why don't you wake up and smell the coffee? Yahoo's stock will move all over the map, but over the long run it is going much higher from here. Do some homework. Talk to the company. Talk to advertisers. Take the time to understand the scope of Yahoo's business, its strengthening competitive position, and the prospects of this emerging industry.
Question your position. You might end up actually making money, and that's what interests most of us around here. There is only one thing worse than being wrong about a trade...staying wrong. That's what cementheads do, and they rarely recover. I've been there. |
