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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Brian K Crawford who wrote (3666)	7/11/1999 3:06:00 PM
From: John Stichnoth	Respond to of 54805

Brian, I have to agree with the bulk of Mike Buckley's thoughts on this, and yours on "garbage in garbage out". Not many companies on our list here in SI have the stable history to effectively use the discount rate model. Add to this the pace of technological change and you've got a problem. I really feel it is far better to look at some companies de novo, figure out where they--and their EPS--will be at some future point, and calculate their future price based on that. Of course then you have to guess a PE based on their future earnings. So none of this is a sure thing. Good candidates for this approach are QCOM, GSTRF and WCII. Some industries and segments lead themselves to your analysis, however. Large pharmaceuticals are a good example. Their future earnings tend to be uniformly "visible", as the analysts know what is in the pipeline better than an individual investor can. And the companies are covered by lots of analysts. (Now that I get to the end of this response, I realize we are pretty much in agreement.) Anyway, all this jmo. Happy Investing. Off to the in-laws for supper.