re mad, ugly dash to 100.
Nothing ugly about it if you are long,
however, for me, this was not the case.
Sigh. May 90 puts were losers (barring
a miracle--why I'd be happy to see Dell
drop into the lower 90s and get out with
half what I spent...)
So, how many decades would it take for Dell
to buy back all it's own stock using earnings.
Let's see, over the next ten years Dell could
possibly make 2+3+4+5+6+7+7+7+7+7 bucks a
share (absurd to think there will never be
a recession, and that no other company will
ever supplant Dell as a leader in PC sales...
but just for arguments sake, lets assume
that the many other PC sellers out there
will always be incompetent, and Dell will
always do a masterful job of boxing up these
boring commodity items. Earnings are not
adjusted for inevitable splits etc)
So that's 55 bucks a share. Now let's assume
over the following decade the company manages
to survive, continues to remain profitable,
and does about the same thing.
Why, it only takes two decades for Dell to
earn enough money to buy it's stock, or I
think this is right, to look at it another
way, if the price is around $100 twenty years
from now, they will have earned enough money
to trade at book value.
This market is so lame, momentum bullshit. |
