Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Craig Freeman who wrote (7336)	10/5/1999 10:26:00 PM
From: Art Bechhoefer	Read Replies (1) \| Respond to of 60323

Craig, the answer is that fundamentals include one heck of a lot more stuff than price-earnings ratios, especially when the growth rate is high and the earnings unsettled because of the rapid expansion of demand. To use fundamentals requires monitoring several variables, and comparing to other similar stocks. How do sales per share compare? How about cash flow and percentage of stock price in cash and marketable securities? How about growth in asset value, return on equity, and a host of similar measurements? And then try the really tough stuff, like the value of the patents (which typically doesn't even show up on the books), or the value of skilled management. All these factors go into what I call fundamentals, not just the price-earnings ratio. Without knowing how strong the fundamentals were, a typical investor would have little interest in buying SNDK even in the 30's. By comparing SNDK with other stocks, particularly small technology stocks in rapidly growing markets, the price advantage at current levels is clear. But then again, a lot more people seem interested in stocks like AMZN.