Lucent's market cap is around $130 billion, comparable to GNP for several countries
The above, and the fact that lakes have fresh water and oceans have salt water... are completely irrelevant to LU's stock price.
However, future expectations of earnings, based on specific contracts, and use of technologies that LU can provide etc. etc. will affect the price.
So long so that:
1. Expectations continue to be met. (by LU).
2. Growth in their markets, (and specifically LU's Share), continues to be strong.
3. Specific events relevant to Lucent, i.e. what can they do or not given their agreement with AT&T, will turn (soon), positive for LU.
4. General business environment (i.e. interest rates, and sentiment), continues to be favorable.
5. Demand for LU stock from the investing public (both retail and institutional), continues strong.
6. Continued influx of cash (in general), flowing into the stock market from domestic and foreign sources, remains at current or possible higher levels.
Then, short of a considerable (and unforeseen), catastrophe that would modify or affect the above, the price of the stock will continue to rise.
As for:
Lucent announced loosing a record $230 million and everyone is buying.
What is the reason for the loss ? I understand is due the cost of considerable acquisitions..... if such is the case, then what will be the marginal benefit of the acquired units/businesses, etc.?
The key words are: EXPECTATIONS of FUTURE events.
The first decision to make, prior to the above considerations, (for the individual), is to determine if one is an investor (medium to long term holding), or short term (speculator-day trader).
Of course, one can always park money in cash at 3.5 %... per year, and "eliminate" all risk.
Just another point of view. (which is exactly my opinion, no advice whatsoever, as I really have no idea what I am doing).
Z.
"The chief value of money lies in the fact that one lives in a world in which it is overestimated." |
