Good Investment Theses: VALUATIONS w/ FUNDAMENTAL ANALYSIS Message Board

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Strategies & Market Trends : Good Investment Theses: VALUATIONS w/ FUNDAMENTAL ANALYSIS

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To: The Other Analyst who wrote (15)	2/4/1999 6:56:00 PM
From: Edwarda	Read Replies (1) of 160

Don't lose faith indeed. Re shorting an overvalued stock: I know someone who on the basis of highly professional fundamental analysis, shorted Compaq on its first major nosedive in 1991(?). And the sucker hung in there. He stayed short. And the sucker hung in there. He gave up. And the sucker missed the numbers and dropped 50%. The same thing happened to him in Oracle. He knew the revenue recognition was dicey and could see the company heading for the wall. Finally, he got tired of beaten about the head and body so he gave up. And the sucker hit the wall. One way of looking at the "portal" stocks, which are rapidly morphing into something else, is to think of them as having a long subscription capture, much in the way investors are willing to pay up for Time Warner's cable body count. Some, such as AOL, are actually able to increase the premium they charge for merchandising and advertising space. BTW, speaking of mob psychology, the following post has a nice way of characterizing TA. Message 7663920

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