Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Glenn D. Rudolph who wrote (144650)	8/3/2002 8:20:23 PM
From: Bill Harmond	Read Replies (2) \| Respond to of 164684

>>That can be said for many people on SI as well. No way! :)

To: Glenn D. Rudolph who wrote (144650)	8/4/2002 4:20:35 AM
From: H James Morris	Respond to of 164684

Re: Bill Miller read between the lines. Bill Miller's investors now owns 80 million AES shares. Amzn only 64 million. You can buy AES monday morning for around $2.15 ps. Bill Miller believes in averaging down or call dollar cost averaging. It appears a lot of Bills like to average down.;) Sept 25 2001. >>Miller's willingness to throw more and more money at holdings that are getting smashed has paid off richly over the years. In 1999 he bought Waste Management at $51.65, shortly before it got hit by an accounting scandal. He kept buying as it plunged to a low of $13 and has made $135 million as the stock has rebounded to $29. "If you want to boil down everything we do," he explains, "it's this: The guy with the lowest average cost wins." He's right, of course. Consider Amazon again. In the middle of this disaster, he has managed to lower his average per-share cost to $30. That's a far cry from its current price, to be sure--but it's a lot better than the $80 he originally paid. By the time he reaches the airport, Miller has made up his mind about AES. "I want to get this thing really covered. I want it remodeled and to sit down with management." Suddenly there's a sense of excitement in his voice. "This has the potential to be like Waste Management at $13. We could double our money in two years and make five times our money in five years." In the weeks that follow, he ratchets up his stake in AES to 32 million shares at a cost of about $500 million, cutting his average price to $16.34 a share. "It's the only thing that has to work next year," he says, "and we'll beat the market." Three weeks later Miller is in his office on a Friday morning. He's dressed nondescriptly in a gray suit, white shirt, yellow tie, and black tassel loafers. The shelves are filled with books--Swarm Intelligence, The Metaphysical Club, The Biology of Business, Zen in the Markets, The Essential Buffett, The Pre-Socratic Philosophers. Hanging from a ribbon behind him is a badge that reads, ASK ME ABOUT 10 FOR 10. Yes, Miller cares--a lot--about his market-beating record. An analyst stands beside Miller's desk, nervously sliding his foot in and out of his shoe. He's in the throes of explaining to his boss the precarious debt situation at Providian Financial, a subprime lender owned by several Legg Mason funds. At Washington & Lee, Miller had called it an "exceptionally cheap" stock, but today it's in the process of dropping 58% to $5.15, down from a high of $64. The analyst says he has a headache; Rapuano says she wants to kill herself. But Miller isn't fazed. "Okay, cool," he says--and buys some more. As Rapuano puts it, this is just the normal functioning of "the super-probability machine in Bill's head." (With the stock trading at less than five times last year's earnings, explains Miller, "we're not taking that much risk.") Truth is, his gift for playing the odds has served him brilliantly in recent weeks. On the trip to his alma mater, he even identified the exact bottom of the market: Sept. 21. Since that day stocks have regained all the ground they lost in the aftermath of Sept. 11. The panic on Wall Street has dissipated, and the volatility index has eased, as Miller predicted. More to the point, many of the stocks he bought during the late-September plunge have surged. Since Sept. 30, Nextel has risen 26%, Dell 45%, Gateway 50%. His holdings in Citigroup, IBM, and Lucent have all risen between 20% and 50%. The Tellabs shares he bought Sept. 25, at $10.50, recently hit $18. Even Amazon has done well of late, soaring more than 50% from its low, to $9.20. As for AES, it hit a low of $11.60 on Oct. 2 and has since jumped 46%.