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.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (16471)	2/20/2003 10:09:33 PM
From: Spekulatius	Read Replies (1) \| Respond to of 78666

I think I would have bought CCL instead of RCL, if i decided to jump into the cruse ship sector at all. Sure RCL has a lower P/E ratio but also a much higher leverage. Debt to equity is 1.35 and it looks like this number will increase due to heavy investments. Interest payments are about 10% of revenues, compared to 2.5% of CCL. I generally have put more emphasis on the "quality" of companies I invest in,than on valuation recently, after jumping into stocks like ELN, EP, MIR and the like. Measures of "quality" are market share, ROE, leverage, growth, management. What I found is that investing in "lower quality" and hence cheaper stocks does not work for me in a bear market. In my opinion, the strongest companies will recover first when the economy recovers and there will be a sweet spot when jumping into the 2nd tier companies will be more profitable as the bull market returns.