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

To: Michael Burry who wrote (2484)	11/16/1997 2:01:00 AM
From: Paul Senior	Read Replies (2) \| Respond to of 78627

Okay I had my say on diversification. Graham says 10 to about 30 issues. That would let everybody (else-g-) on the thread nod their approval. Anybody want less, they can get confirmation from Loeb ("The Battle for Investment Survival", p. 118) for one or perhaps 2 or 3. Mike, APM certainly is a risk. There is a new technology and APM is behind in incorporating it. 6 weeks ago, this was seen as a positive (older tech more profitable); now, and with the price halved, it's a terrible negative - or so I read. Well APM has qualified this new technology with 2 customers - this was reported in the last quarterly. My bet is that if they qualify, they have the money and resources and flexibilty and will actually be able to manufacture to customer requirements. After all, this isn't a regulated business -- these people exist in a tough competitive environment (which indeed has seen more then one company go down.) If there is a paradigm shift, then from what I can tell all competitors will be at ground zero. I am betting that APM will get its share of the customers' business. Any concern over the Asian market for computers is, IMO, overdone. A computer will be or is, a must for parents trying to provide education for their kids. Furthermore, DD's are mechanical - they do wear, so there's replacements, upgrades...lots of good stuff. Of course for APM there's competition, ramping up mfg. problems, few but large customers (and at some point this is a positive as I would guess the customers would not like to see their supplier base (APM) diminish (APM go bankrupt)), and maybe even more problems the Market or I don't now see. So the next quarter or two isn't going to be so great. Co. has earned good money before and IMO will do so again. 4-5 quarters from now the stock should be at a good place compared to today's price. So, for the way I invest (or keep telling myself I would like to invest -g-)... a small position in APM in a well diversified portfolio, held for the long term, maybe avging down more as tax selling, fear, etc. drive the price even lower... should work out okay. Paul

To: Michael Burry who wrote (2484)	11/16/1997 8:59:00 PM
From: john harris	Respond to of 78627

Mike: Happy Birthday to this thread! The discussion of Graham and Buffett type history of earnings, projected future earnings, and discounted present value of such estimated earnings does not seem to come up much on this thread. Graham and Buffett were rigid in being able to come up with a quantitative comfort level (margin of error) for each investment. I'll try to dig up some numbers from file and post them.