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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: uu who wrote (20717)	11/3/1997 3:38:00 PM
From: sea_biscuit	Read Replies (3) \| Respond to of 61433

The following is excerpted from an interview with James O'Shaughnessy, published in LA Times in December 1996. Ascend then was at 70 or so. Makes interesting reading... Dipy. -------------------------------------------------------------------- [...] Q: And yet it outperformed the S&P 500. A: By a lot. The Cornerstone Value strategy between 1952 and 1995 compounded at 15.3%, turning $10,000 into $5.2 million. The S&P compounded at 11.91%, turning $10,000 into $1.4 million. Q: So this is almost a no-brainer, even for people who have trouble sleeping at night. Any names from this list? A: British Telecom , Philip Morris, US West, J.C. Penney, Reader's Digest, Atlantic Richfield. Q: OK, let's move on to the losers: high price-to-sales ratio, I presume? A: You can buy shares in Cyber Cash Inc. and have the joy of paying 3,970 times sales. Oh, boy, have we got some stocks for you! How about, also Alpha Beta Technology you pay 2,442 times sales for that. Here is one we all know--Yahoo! at 45 times sales. The yahoos are buying Yahoo!. When you put it in stark terms like this, only an idiot would pay that much for a stock like that. But people aren't thinking about it that way. They are thinking about the story behind Yahoo! They are thinking about the fact that this is a brand new technology and it is going to the moon. Q: Any big names that we all know and love? A: Yeah, I've got some names that will really surprise you. Microsoft, Coca-Cola, Ascend Communications--they have a price-to-sales ratio of 17x. Cascade Communications, a price-to-sales ratio of 23. Loral Space & Communications, McAfee Associates, they do the Internet software. Netscape Communications, almost 14 times. Q: Just to sum up, you have identified certain investment strategies that have survived the test of time, but they work only if you apply them consistently and stick to your guns. Don't get carried away by emotions, don't follow the crowd, just follow the discipline. A: Exactly, that in a nutshell is the way to do well on Wall Street. [...] Jim O'Shaughnessy's Pans HIGH PRICE-TO-SALES RATIO, LARGE STOCKS Stock Ticker Recent Price to Price Sales [...] Cascade Communications CSCC 61 7/8 22x Ascend Communications ASND 71 _ 19x [...] ---------------------------------------------------------------