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

To: Paul Senior who wrote (44467)	9/21/2011 6:01:51 PM
From: Sergio H	Read Replies (1) \| Respond to of 78476

I look at the fundamentals as well basic technicals. When a stock is hitting new lows and doing so with average volume it indicates that there are more sellers that have yet to unload. So, a buy on GLW today, before the program selling reaction to the Fed. policy, would not be a good entry point or a good opportunity to add shares. I would look to see why the stock is hitting new lows instead of guessing or just looking at the numbers and saying it is a good buy based on their prior history. It appears that the flat panel displays account for half of the GLW's earnings and that their market share in this segment has been steadily declining since its peak in 2009. Additional concern is that only two customers account for almost all of their flat panel business. I do agree with you that some of the numbers indicate that the price on GLW is close to finding a bottom. The PEG is very attractive and analyst are forecasting that their flat panel sales will pick up. On the topic of Platinum, what's different now is the relationship with the price of gold and platinum. Platinum has historically and consistently traded at substantially higher prices than gold and futures for the two metals are currently even, suggesting that the upside for platinum is higher than for gold.

To: Paul Senior who wrote (44467)	9/21/2011 7:24:14 PM
From: J Mako	Read Replies (1) \| Respond to of 78476

More thoughts on GLW. I read the transcript of the most recent conference call. CFO hinted returning cash to investors (buyback?) was now on the board's agendas. I gave it some more thoughts. GLW's effective tax rate in 2010 was only 15%. GLW has a lot of offshore equity earnings. So the GAAP earning figure isn't real. To bring the money back, correct me if I'm wrong, GLW needs to pay for the difference in tax. And of course, some of those retained earnings will be plow back into Capex locally without incurring additional tax. I did a back of envelope calculation. Assuming GLW will bring back distributable cash back onshore after local capex, it's trailing P/E will be more like 8.5x. Now, thinking about it, there is a simply way to look at it: we can simply use EV/EBIT to bypass this taxation mess. I suppose large-caps like MSFT, GOOG, CSCO, etc with lots of cash all have this issue.