Semi-Equips - Buy when BLOOD is running in the streets! Message Board

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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets!

LRCX 177.33

+1.2%

Dec 24 9:30 AM EST

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To: Mason Barge who wrote (6803)	8/28/1998 12:16:00 PM
From: Robert Douglas	Read Replies (2) of 10921

Mason, You wrote: Personally, when I see book below 1.2 to 1.5 (depending on the sector), I start looking at it as a negative, or at least a red flag. This is just a word of warning for virgins -- if you've never had a stock go to $0, you might not fully appreciate just how possible a 100% loss is. From a non-virgin's perspective. Believe it or not book value once meant something. It was as recent as 1982 that the S & P Industrials sold below one times book value. There is certainly no argument about what a buy signal that was! Book value is of course only a crude attempt to determine what is really valuable, which is replacement cost. The reason book value means so little when talking about companies involved with rapidly changing technologies is that there is no sense in replacing something with no economic value despite its' accounting value on the companies books. In other words, who is going to replace something with no use. -Robert

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