Well, if you think LU, Dell, msft, csco are all over valued, then what about INTC and MOT ? Do you think MOT and INTC are under valued ? Then why the stock price did not move up ? The stock value is decided by the last price being traded, that is the most fair value decided by the market, i.e supply and demand. Do you think
a small apartment in SF sold for $300k is over valued ? then why the price keep
going up, while the same apartment in the south asked for $20k and nobody wants it ?
The reason people want to pay a high PE to buy those stocks is because their high growth rate and consistency, the future prospect of its products. For MSFT, we see
no competition on the horizon in the near future, and PC is still growing fast, and that is its value. The same for CSCO, DELL, and LU.
As to INTEL, the PE is low , but the competition is on the horizon, and the sub $1000 PCs will kill the company's margin. |
