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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Bob Rudd who wrote (9513)	1/4/2000 5:34:00 PM
From: Madharry	Read Replies (1) \| Respond to of 78609

In the future please let us know right away what your are selling Bob and when. IF it works out perhaps we could change the name of the thread to Value investing and Bob Rudd's contrary timing.

To: Bob Rudd who wrote (9513)	1/4/2000 10:44:00 PM
From: James Clarke	Respond to of 78609

I'm short QQQ as well, and I would be shocked if next year's P/E is anywhere close to 55x. I think its more like 100x, but I'll check that when I get a chance.

To: Bob Rudd who wrote (9513)	1/5/2000 12:26:00 AM
From: James Clarke	Read Replies (1) \| Respond to of 78609

OK - I ran the numbers on QQQ (which is the largest 100 stocks in the Nasdaq, give or take). Some really interesting insights into the valuations of the "other half" of the market if you bear with me for a few minutes. First of all, let me just get my two cents in on the "crash" today. That "corrected" the Nasdaq 100 all the way back to the level it traded at the last week of December. Yes, December 1999. You might remember it - it was last week. I have to laugh when the same TV commentators who were saying "It might be due for a correction" last week are now saying "It might be a buying opportunity" at the exact same price level. I shorted the damned thing in early December, and this price doesn't feel "correct" to me. Anyway, I took as an approximation for the Nasdaq 100 the top 100 Nasdaq market caps as of December 31st. Then I aggregated the earnings (and just as important, losses) of the component companies and calculated the ratios based on a market cap weighted index investment. Here they are: Trailing 12 P/E 133 CY 1999E P/E 129 CY 2000E P/E 96 Price/Sales 13.5 Price/Book 17 Disagregating the index leads to the following observations: Here are the biggest 11 stocks with their respective P/Es for 1999 and 2000. These eleven make up 60% of the market cap in the top 100. WHAT FASCINATES ME IS THAT ALL THE EARNINGS ARE IN THESE ELEVEN STOCKS. THE NEXT 89 COMPANIES COMBINED EARN NOTHING. ZERO. Microsoft 75x, 66x Cisco 123x, 96x Intel 36x, 31x Oracle 114x, 90x MCI/Worldcom 40x , 28x Dell 70x, 50x Sun Micro 99x, 77x Qualcomm 231x, 162x Yahoo 983x, 627x Amgen 62x, 55x Applied Mat. 52x, 36x Thats about as much work as I have ever done on the tech sector. I remain uncomfortably short QQQ and a little AMZN. I also added a TGLO short today at 9 with a stop loss at a little under 10. I think the risk-reward is in my favor there if the business is as worthless as I think it is. JJC