Just read Barrons at the library and came across the following interesting and pertaining stuff:
Good article by a market pulse taker, the kind who lives off of having big $ buy his fancy market timing/pulse taking service using TA and other stuff. he had this to say- that Indexing is driving the Dow and S&P to ridiculous heights,
S&P is a pe of 22!
gillette 31
Coke 36!
Proctor & Gamble 24!
Merck 26!
And that only 7% of all mutual funds have beat the s&p's return so far this year. So much is going into s&p because of it's outperforming most mutual funds over the past couple years, that it's becoming a self fulfilling prophecy.
Saw predictions of Dow 7500, but most everyone is warning of a 10-30% correction, and that small caps may do worse (as they usually do) or less worse (because they're so undervalued right now in comparison) in a downdraft. Don't know how or when big caps will finally go to reality, but if they get creamed, so will AXC, if it happens all at once. What we need for AXC is some market rotation into small caps, leaving big caps to languish at only slightly lower prices.
Also saw that big money's quarterly poll showed tech sector is favorite this survey anyway.
Stocks with 10% of their share price in cash,
with improving operating eps of 100% year over year,
with 100% improvement in their biggest product line,
with 100% eps forecast for 97
with 100% eps forecast for 98
with possible eps continued growth at 100% for another 3 years after THAT performance,
don't deserve to be trading at 14X 97 eps and 7X 98 eps and possible 1X 99 or 00 eps,
at prices the Chairman bought $2.4M of stock recently,
at the same price it was when an analyst put out a buy rating becuz he thought they'd get a KM contract b4 end of year (they did! so why are we at the same price as which he recommended it?)
If I can I'll buy more, as should anyone who can at these prices.
I've begun to call this "The Winter at Valley Forge" for all the faithful who are looking beyond the current malaise and looking forward to a bright future of triple digit share prices.
And you heard it from me first, I guess Western Digital will sign b4 the end of the year, with production starting before the end of the year. No, I've got no rumors, just expecting this 100% TFI company to act rationally when confronted with 30% extra performance for under $1/platter for licensing or reselling. |
