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

To: jhg_in_kc who wrote (2761)1/30/2001 1:13:58 AM
From: James Clarke  Read Replies (2) | Respond to of 4691
 
The reason I bought Dell in the teens is the same reason I didn't in the 50s. Valuation. I might be interested in EMC too at about 25. The lesson of the last year is that valuation matters. EMC at 100 times trailing earnings looks incredibly dangerous. YHOO might make sense at this price, but I just can't figure out how to value the thing so I pass.

Dell didn't drop 60% because its long-term prospects deteriorated - it dropped 60% because it was overvalued. Its long term prospects have not changed, though Wall Street's perception of them certainly has. Sure, Dell is now not going to grow 30% indefinitely...but it was NEVER going to grow 30% indefinitely.



To: jhg_in_kc who wrote (2761)2/5/2001 12:01:03 AM
From: Moominoid  Respond to of 4691
 
I agree with James Clarke that DELL was now attractive at a much lower price. That is the key element of Buffettology that you seemed to miss before. I bought DELL at 22 1/2 and UIS at 12 something in the last few months. MSFT too but should ahev waited for the real bottom...


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