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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (62744)	4/6/2002 1:30:31 PM
From: Cary Salsberg	Read Replies (1) \| Respond to of 70976

AMAT and KLAC are not cheap, but in quality they are also dear. The name of the game is accumulating quality while lowering average cost. Use covered calls calls to benefit from people who don't have a clue and to lower risk of ownership. At its peak in 2000, LLTC earned an after tax profit of 45% of sales. Last quarter, after a severe sales decline, that number dropped to 37%. A PSR of 10 for LLTC is very conservative 22 - 27 PE. In Fisher's book "Super Stocks", he practically created the concept of using PSRs. Fisher pointed out that PSRs may be used during a TEMPORARY decline in earnings as a tool to predict future earnings and hence stock value. Yes, high PSRs without a strong argument for future earnings and reasonable PE is not wise investing. I like Scott McNealy, but he has his hands full with his competitors, MSFT, INTC, IBM, HP, and should pass on giving investment advice.