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Strategies & Market Trends : Value Investing

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To: LauA who wrote (6716)4/13/1999 11:34:00 PM
From: Q.  Read Replies (1) of 78616
 
LauA,

My take on CURE is that it appears to be a sort of rotten apple that generates bad news that helps drag down the sector as a whole. Rather than pulling your hair out trying to decide whether CURE isn't rotten enough to deserve its badly depressed price, my approach is that it would be better pick a good company in the sector, and enjoy the historically cheap valuation it has due to the bad news generated by other companies in the sector.

CURE was one of the peer stocks I used to compare RHB about 2 days ago.

I had the following link with Yahoo charts and p/e ratios for these peers, quote.yahoo.com

Yahoo shows a TTM p/e of 3.6 for CURE. Compare that to 7.7 for RHB.

CURE appears to be in all kinds of trouble, whereas business is going great for RHB.

The two provide very different kinds of business to hospitals, and RHB has no possibility of being cited for Medicare fraud because it merely provides contract labor and doesn't do any patient billing. But no matter, the sector rotation out of these small medical service stocks is depressing the good along with the bad.

You can make it easy on yourself and take the good company selling cheap.
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