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

To: Sam Johnson who wrote (12172)	12/6/1999 12:17:00 PM
From: DownSouth	Respond to of 54805

Sam, good post and good dialog this weekend. It encourages me to see you start in one well-thought out opinion and be brought into an even more thoughtful opinion that is in line with what many of us believe. These definitions are very important, and we will not be able to communicate unless we agree on our language. JDSU is, indeed, a King inside a Tornado. They will remain a King, imo, in their current market space, and the possibility of becoming a Gorilla is difficult to fathom. So we will hold, but we will hold lightly, looking for that wall that they will inevitably hit.

To: Sam Johnson who wrote (12172)	12/6/1999 12:47:00 PM
From: 100cfm	Read Replies (2) \| Respond to of 54805

Sam <<If a company gains control or leverage of the value chain in a market in tornado, it's definitely earned the right to a tremendous amount of investor attention. But it's not necessarily a gorilla.>> AGREED,100%. << And the more we play with stretching the definitions - like I did this weekend :) - the greater the danger of calling companies gorillas that may be more vulnerable than a true gorilla. I still like my argument about the value chain. I just think it's wrong. :)>> your point is well taken and we must be careful in doing any stretching at all. rather then stretch,i think it's healthy to push the envolope of our understanding of the authors criteria and maybe just turn our candidates to a different angle when looking thru our magnifying glasses. <<With that in mind, JDSU looks more and more like a king to me. I'd be more comfortable calling them the most bad-a** king on the block than a true gorilla.>> i think we have no choice at this time, until there is no doubt a company should never be called a gorilla. i guess the question is, are all gorillas so clearly obvious such as msft, cisco and Q? so as to question whether one is a gorilla or not precludes them from being one. or are there different shades of gorilla?? just pushing the envelope. <<That's a great point, and an example of why they may not have gorilla DNA. By definition, once a gorilla is embedded in the value chain, their position is unassailable. That, I think, is the key. Once there, there's no way they can be knocked out. If LU or anyone else can decide to do things differently and threaten JDSU, they're a king. About the patents...I'll defer to someone who knows more about them than I do.>> this is my point, lacking that knowledge is there another indicator we can look at that would portend they have an ipr lock and gorilla dna. <<I'm pulling back from my idea that a king can morph into a gorilla. However, I think that noticing that they look like a gorilla is a great observation, because it means you've probably got a terrific investment opportunity on your hands. And I like Lindy's idea a lot...to go out and find us some more kings.>> you bring up another good question. can a king morph into a gorilla??? and if so if we can identitfy those companies then the below statement is worth repeating. "investing in those companies at that time will yield tremendous profits." what we would be doing is performing an ultrasound on the embryo of an unborn gorilla. riskier only if our observations are wrong and well worth further discussion to determine if it's possible. 100

To: Sam Johnson who wrote (12172)	12/6/1999 6:50:00 PM
From: Mike Buckley	Respond to of 54805

Sam, I'm guessing the authors made the criteria for gorillahood pretty stringent for a reason. No need to guess about that. From the manual's Introduction: "Ours is deliberately a hyperselective investment strategy which calls for investing in so few companies as possible. The number of hoops a stock has to jump through to get into the final set is so great, and the criteria are so restrictive, that perhaps 100 of the 8000 or so public companies-- and no private companies -- will qualify. ... To meet the specific needs of a risk-averse and captial-constrained investor, we have imposed a much tighter set of constraints than govern the bulk of high-tech investors currently in the market." (Italics for added emphasis were used by the authors.) --Mike Buckley