Re: " I hate to bring up fundamentals", and " I see no real bears on this thread"
I got very, very close to selling the remaining half of my leaps today. The only thing that stopped me was when I figured out the taxes I'd pay. I predict that, sometime during 1999, anyone who bought amat in the 50s is going to be very unhappy. I'm now 70% long stocks/calls, 25% cash, and 5% puts. For much of the last two years, I've bought up to 1/3 of my portfolio on margin. Today, I have no margin. Over the next few weeks, if current valuations hold, I'm going to buy a lot of puts (probably index puts), and/or sell my calls. Investors in this stock, and the sector, and stocks in general, are not pricing risk accurately. There are lots of risks out there that are being ignored.
Applied Materials is a money-making machine......eventually. But not now, not last year, not for the next 12 months, and that's as far as anyone can reasonably predict.
Selling AMAT at a P/S of 6, and buying it back when it hits a P/S of 2 (yes, it will be available at that price again, just as it has over and over in the past) is foolproof. |
