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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: shadowman who wrote (53363)	7/17/2001 1:52:23 PM
From: Rande Is	Respond to of 57584

Dennis, It seems a bit of both are at work here. Overly optimistic guidance by corporations. . . yes. . .but isn't that the norm? Don't we expect all companies to be overly optimistic . . .all the time? And as consumers. . .aka/ retail investors. . .we rely on the mammoth brokerage house and investment bank analysts to sort out the truth. But do they? Should they? This is why congress is looking into the whole role of the analyst. . . and why we even have them. They seem to only help themselves and their employers. . . at the cost of the newbie investors. My skepticism is that I believe they [the analysts and/or their employers] are not interested in the truth. It is difficult to imagine that each time a company comes out with a more and more optimistic guidance. . . nearly every analyst is eager to upgrade the stock. . . to the point of ridiculousness. When they were doing those ridiculous upgrades, we were all making fun of them. Remember when QCOM was upgraded to $800? I called it a short-sell at . . .as I recall. . .$380. There was no way the company could support such valuation. It was totally obvious to everyone. . . . except for [as they would have us believe] the analysts who cover the stock? No way. They aren't that stupid. And as we uncovered. . . [with the media jumping on the bandwagon]. . analysts like Meeker and Blodgett were shameless in their upgrading. . . to the point of accusations of negligence, recklessness and total disregard for the investors with whom they are paid to advise. And what criteria constitutes a downgrade of a stock in which the analyst's employer has an investment bank relationship? And how does that criteria change. . .when that same company is looking at a stock in which they and/or their big customers are holding large positions short? Again, I have to say that it is difficult for me to believe that they were sincere in their ANALysis when their stocks were in the hundreds, and the dozens, and the teens, AND the single digits. The really sorry part about it was that they did not even seem BALANCED in their views. . . these were buys and thats all there was to it. And these are just two of the many analysts we saw out there upgrading last spring when we had all sold out of techs. Yes, you make a great point. And I totally agree with you that much of the time, it is a chain reaction that causes such a misunderstanding. . .or overvaluation. But no way will I dismiss the analysts from blame. Thanks for the good argument, Dennis. This is how we all learn. . . and make up our own minds. Rande Is