Kathleen,
Thanks for your guidance.
>>Since MU is reporting a consolidated financial statement, the
"value" of the MUEI stock doesn't matter. It's already included in
MU's shareholder equity.
With this assumption, I calculate the "true equity" of MU (after
MU sells all of MUEI) to be:
=MU stated equity - MUEI stated equity + 64% of MUEI
=$2874M - $393M + 64% * 96M shr * $11/shr
=$3157M
"True Book Value" would be:
=$3157M / 212M MU shrs
=$14.9/shr
This True Book Value would likely be less if MU actually
sells all of MUEI assuming that MUEI would be worth less
without MU's support.
>>but after doing that for 18 months and loosing money on MU all the
time, I finally gave up that particular obsession
Don't give it all up, it'll probably help one of these days.
Fundamentals help me set the "floor" or "value" of a stock.
It also helps me understand whether the company is a sound
investment.
The expert investor needs to consider all factors that influence
the price of a stock. The price of a stock is influenced by
people who are really value, momentum, or technical analysts
(any other types?). One can see this by reading the various
postings to this board. If one indicator is not working, chances
are that another indicator is. This is because there
might be more of one type of player than another type at a particular
time. I've been most successful using value and charting
analysis to buy low & sell high. I've been least successful
shorting - likely because it is difficult to predict how far up
momentum players are willing to bid up the prices (e.g., Yahoo).
There are many factors influencing MU's price right now:
the price of DRAMS (keeps the price from rising significantly), fundamentals (losses will keep the price from rising significantly),
and charting (keeps the price within a channel).
Anyhow, thanks again for your help.
Ted The Technician |
