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Technology Stocks : Creative Labs (CREAF)

CREAF 0.448

-4.6%

Dec 17 12:59 PM EST

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To: sdr who wrote (11829)	7/12/1998 4:37:00 AM
From: Flint	Read Replies (1) of 13925

For Low PE studies see research by Paul Miller and Jay Sherrerd in the 1960s. Nicholson also in eaerly 60s published in Financial Analysts Journal. As far as I know, the conclusions are all that low PE outperforms. The latest was by Basu and published in the mid-1970s in the Journal of Finance. I guess since then, noone's bothered to much trying to disprove this anymore. As for ur definition of value, it seems somewhat unorthodox. OTher studies like those done by Barra use Price to Book. That also suggests value beats growth over the long run. The current bullishness going through the US market is driving a "growth" phase. As i see the "fundamental" arguments being levelled justifying ever higher PEs for high growth stocks, it just makes me a little amused and very afraid. As with all great boom phases, the arguments used hold various truths. IMHO, as surely as night follows day, growth will give way to value. eNjoy the Bull while you can. It won't be here forever. The problem, tho', is that when the bull run ends, value stocks will also fall.

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