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Technology Stocks : JDS Uniphase (JDSU) -- Ignore unavailable to you. Want to Upgrade?

To: Robert who wrote (20594)	6/21/2001 5:23:28 PM
From: OWN STOCK	Respond to of 24042

Robert: JMHO, on the contrary, the time to buy is the low, which is nigh. Waiting for the herd gives up more than 30% of your potential gain. Same with the high...30% there...so if you want 40% of the gain...wait for the herd. -Own

To: Robert who wrote (20594)	6/21/2001 6:14:51 PM
From: KMcKlendin	Read Replies (7) \| Respond to of 24042

Re: The correct time to buy is when fundamentals start improving...why buy now? It is anticipated to be 1 year to 18 months from now... Robert Hi Robert-- I'd like to answer your question by first explaining why I respectfully disagree with your premise. Then I will explain my reasoning behind my preliminary purchase of JDSU. The correct time to buy, in my opinion, is before (not when) the fundamentals start improving. The market is an efficient discounting mechanism. Therefore, JDSU will be up significantly before fundamentals are clearly improving. In converse, and as we have seen, JDSU was significantly off its peak before strong evidence of fundamental deterioration. A good example is the cyclical semi equips which are always well off their low before evidence that the cycle has bottomed. You also mention that industry fundamentals are forecasted to improve in 12-18 months. I would distrust "expert" opinion. First of all they are unable to accurately forecast; second they are untrustworthy. These are the same analysts that unanimously recommended JDSU at absolutely insane valuations. They inflated the bubble and lost untold billions of investors' money. If one has to listen to analysts (and I would ignore them), it is likely more profitable to do the opposite of their recommendations. Now why did I buy JDSU? First I agree with the common assumption that this company, long term, has a very bright future. The logical extension of that assumption is that I will make good money LT if I can buy it at a reasonable valuation and lots of money if I can buy it dirt cheap. According to my fundamental value analysis this company is on the cheap side of reasonable. Therefore I have established an initial position. I am hoping the stock goes down so I can significantly enlarge my position. If the stock goes up, I do well; if it goes down I do much better, buying a great company at a panic price. To be fair, my technique has possible weaknesses: (1) the assumption that JSDU's profits will significantly grow in the LT future may be wrong; (2) my fundamental value analysis may be wrong and the stock may still be overpriced. One last thing (this doesn't have to do with your post). One of my pet peeves, and something which I cannot disagree with strongly enough is this idea--one should not buy a great company cheap because it is "dead money." Impatient investors that would rather gamble on unpredictable short term price movements rather than allow a great investment opportunity to mature are (in my opinion) very mistaken. I hope this answers your question and would welcome feedback. --Keith