Electronic Contract Manufacture (ECM) Sector Message Board

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Strategies & Market Trends : Electronic Contract Manufacture (ECM) Sector

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To: kolo55 who wrote (1530)	5/18/1998 2:41:00 PM
From: jeffbas	Read Replies (1) of 2542

Paul, I must say that I am perplexed as hell. With your help, I have come to believe that we are in the early stages of the outsourcing trend in term of revenues to the major ECM companies. The very fact that major US companies seem to be accelerating their outsourcing, and of core business, suggests to me that the general perception that these companies don't add much value and should sell at low multiples (like distributors) is ludicrous. I really see no reason why a company like JBIL couldn't be doing $10 billion sales in half a dozen years and selling well over $100 (which makes short term trading out at $44, which we could have done, a poor odds strategy). Do you agree? This would make the current sellers idiots. But then where are the funds with long term perspectives to buy all they can get their hands on in the $30's. What could we be missing? (I do note some insider selling reported on Insider Trader last week.)

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