Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 252.25

+0.9%

Nov 28 9:30 AM EST

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To: Duker who wrote (28956)	3/8/1999 2:01:00 PM
From: Sun Tzu	Read Replies (1) of 70976

Surprisingly, you are right on most of what you've said. This must be quite an achievement for you. However, as always, you fail to see the point, so let me explain it to you. Unless AMAT of the past ten years has gone away and this AMAT has nothing in common with its past, it should still trade within the same range of fundamental values as it has over the past ten years. Based on that you can estimate what is the minimum sales growth that AMAT should have so that its current price is justified. This is what I tried to show. Now if you think AMAT will beat those "priced-in" estimates, then you should buy it as an investment. Otherwise, just trade it with the flow. I'd also like to point out that the best YOY sales growth that AMAT has ever had was 208% ('88/'89) and the best over two years ('88/'90) was 289% (not annualized). Who knows, may be your superior fundamental analysis can show that AMAT will increase its sales by 550% to justify its current price. >> I could be a lot more efficient if I could do that. You can try to buy a good historical database along with the related software, but I doubt that would make you a better investor; it takes an open mind and some inteligence to use the data. Sun Tzu

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