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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: patron_anejo_por_favor who wrote (42308)	1/17/2003 6:14:09 PM
From: Haim R. Branisteanu	Read Replies (1) \| Respond to of 52237

Correct - are you questioning the outcome ? IMHO the indecision that is going on now regarding a decisive war in Iraq is perceived as weakness and lack of determination on the US side and reflect the perception that the US is prone to more terrorist attacks similar to 9/11 in their economic impact.

To: patron_anejo_por_favor who wrote (42308)	1/18/2003 9:38:29 AM
From: mishedlo	Respond to of 52237

Lance Lewis SNIP: MSFT Confirms That Tech Is No Longer A Growth Industry ...As everybody now knows, MSFT guided down last night and said that it sees no sign of a pickup in IT spending. In an obvious attempt to support the stock, the company tried to soften the blow by first announcing a stock split and a dividend. As we saw with AMAT last year, the stock split game doesn't work very well in a bear market. And contrary to the jubilation that occurred initially over the dividend, I find this to be a sign of weakness (the market apparently did too, judging by MSFT's close). MSFT has always been a "growth" stock, and it is priced as such. Announcing a dividend is very likely to be viewed by the market as an admission that the prospects for growth going forward are not good. Tech's days of rapid growth are over, yet people continue to pay outrageous prices for stocks as if those days were going to return just as soon as we got past this “soft patch,” as hopers like to call the environment that we're in. The point is that tech is not going away, but it is entering a more mature, cyclical period. And that means valuations have to come down dramatically. Now, we've been banging on this fact for the last 3 years concerning technology in general. So this is not exactly a novel concept. But this market typically requires an “event” to make it really scratch its head and think, and this could very well be that event. If MSFT is no longer a growth story, it doesn't deserve a growth multiple of 33x trailing EPS and 10x sales, and this sort of thinking could become infectious throughout technology. I think this announcement by MSFT could actually be a very big deal when we look back, as far as overall market sentiment goes, because it may be a catalyst that draws more attention to tech valuations in relation to the industry's dismal growth prospects. As far as PC sales go, MSFT said, "We're looking for PC shipments in the low- to mid-single digits for the fiscal year... Our view continues to be that there has not been much change in the health of the PC ecosystem, where things have continued to be soft." So, that's my take on the fun and games out of MSFT last night, and the market didn't seem to like it too much either, as the stock was whacked for 7 percent and back to roughly its December low. from Daily Market Summary (by subscription) - dailymarketsummary.com