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 : Z Best Place to Talk Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Ron McKinnon who wrote (47683)	4/11/2003 8:53:25 AM
From: DanZ	Read Replies (1) \| Respond to of 53068

<as usual I'll take the other side in order to generate discussion> lol Like most mortals I am not perfect. That said, let's look at your quarterly trading ranges and I'll explain what I meant, right or wrong. By the last couple of years, I was referring to the period beginning after the monster move from 9 to 36 and back to 8. With the exception of very brief periods, the stock has traded between roughly 7 and 10 for two years. I'd call that a narrow trading range, especially when compared to stocks that trade that same range in days or weeks. Another factor is that the typical spread in MTXX is wider than stocks that trade more daily volume. The spread should shrink when the volume increases like it did in early 2000. The 11.625 high in March 2001 came on the day when Matrixx announced that they were selling their gum business to Wrigley. The stock jumped within seconds and then came right back down into the previous trading range. The only way that anyone could have sold stock anywhere close to 11 is if they had a limit order sitting there, or were sitting in front of the computer and had very fast fingers. It only traded over 11 for a matter of seconds, and there wasn't enough volume to get much off. Likewise, the low at 5.40 in September 2001 came in the early morning on the day the market reopened after 9-11. The stock didn't trade there long and traded very few shares below 6. While one could have made a little trading MTXX in the 7 to 10 trading range, my philosophy is why mess with it? There are hundreds of other stocks to choose from that make better trades because of better liquidity and higher volatility. So, while I sit and wait for the stock price to catch up with the fundamentals, I trade other stocks. Is there a reason why I have to trade every stock that I own? Kelvin: A comment to your comment about stocks not being a good investment the last four years. Yes, you are right in hindsight. The question is whether you knew in 1999 that the stock market would be 35% lower in 2003. A better question is whether you know if the market will be higher, lower, or the same in 2005 and 2007. The ultimate question related to MTXX is whether you know if the stock will be higher, lower, or the same in 2005 and 2007. The only thing that I can use to guess what might happen is the improving balance sheet, income statement, and cash flow statement. If the company continues to grow, the stock price will eventually go up, especially considering how reasonably priced the stock is relative to its own growth and other companies in its sector. You can't assume that the market price of a stock on any given day is a fair price. Sometimes stocks are worth more; sometimes they are worth less. Given the fundamentals, is MTXX worth more or less than today's price, or is it fairly valued? I have tried to outline why I think it is worth more. I'd love to hear comments from others that either agree or disagree with me with reasons why. Thanks, Dan