>>To my way of thinking, you need to be able to answer the sell/hold question in terms of the news. Does the news portend a long-term compromise in the underlying growth story of the stock? If so, I would sell. If not, I would hold. So, for example, if earnings are down as a result of weak sales to Asia, I would probably be tempted to hold because that weakness is probably already factored into the price of the stock.<<
Hi again Chuzzlewit... questions for you:
I notice you didn't use the word "buy" and I'm curious as to whether the same rationale would apply to people who may be currently deliberating on whether to buy the stock at the current price. Are there differences in the investing decision process for buyers than holders?
What scenarios of possible types of news on Dell would serve as examples of "a long term compromise in the underlying growth story of the stock"? So far, from what I see, every piece of bearish news/reports on Dell have been regulated by the thread as "propaganda"... well, maybe not as strong as the word implies, but close.
If present news of sector softening and competitors emulating the JIT model are not early signs of long term threats to the historical growth/profitability of Dell, what would be some examples of news you would consider as serious threats? I'm thinking here of the type of exercise executives in business schools go through...identifying opportunities & threats in the environment on the company's fortunes.
>>On the other hand, if lowered earning are the result of a loss of technological edge I would exit the stock very rapidly.<<
Are you referring to Dell's JIT model as the technological edge or is there some other real teckie stuff which I may have missed?
ps: after thought question added before edit time expiry ran out..
Isn't there a significant risk of substantial loss in profit/capital waiting too long for evidence of a downturn in the stock's fortune? I wonder how many IOM bulls kept faith on the stock's technological edge and for how long before the present debacle on the stock price. How much faith do institutional holders maintain on the stock, or are retail investors usually the last ones out?
meow for tia,
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