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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?

To: Trebor who wrote (2284)	12/3/1997 12:34:00 PM
From: Tim Bagwell	Respond to of 42834

There are some stocks that many people and fund managers simply want to own, regardless of the valuations. This sounds like "tulip-mania" where the price exceeds value based only on the existence of a "greater fool" who is willing to pay more. Over the long haul the market will always correct the price to a reasonable value. It has to work that way. There is an intrinsic value to KO that may, arguably, give it a premium to the market. This intrinsic value is due a mass market that will buy its product no matter what happens to the economy. The big bear could show up tomorrow and people would still buy their Coke just as if nothing happened. But at a PE of 40 KO is quickly approaching that region where the "greater fool" theory will be tested.

To: Trebor who wrote (2284)	12/3/1997 12:47:00 PM
From: sea_biscuit	Read Replies (2) \| Respond to of 42834

RE: There are some stocks that many people and fund managers simply want to own, regardless of the valuations. Call it the hype factor, publicity factor, glamour factor whatever, I don't know how to put a "valuation" on it but it's real and to overlook it is to overlook one of the best investment opportunities. I think it is a law of nature that statements like the above should be made once every generation, i.e. once every 25 or 30 years...

To: Trebor who wrote (2284)	12/3/1997 5:13:00 PM
From: sea_biscuit	Read Replies (2) \| Respond to of 42834

RE: KO, MSFT and Intel are just 3 examples. I've done well on each of these. When I feel they have really gotten ahead of themselves I sell covered calls against them -- often an excellent strategy, sometimes not. But whenever I've sold the stocks themselves, I've regretted it within a matter of weeks or months. If I were you, I would let somebody else have the last drink at the waterhole... Too many crocodiles out there. Better to keep off.

To: Trebor who wrote (2284)	12/3/1997 6:09:00 PM
From: Hank Stamper	Read Replies (1) \| Respond to of 42834

Bob, <of the best investment opportunities. KO, MSFT and Intel are just 3 examples. I've done well on each of these. When I feel they have really gotten ahead of themselves I sell covered calls against them -- often an excellent strategy, sometimes not. But whenever I've sold the stocks themselves, I've regretted it within a matter of weeks or months.> Does not this depend on a) the original purchase price and b) expected future earnings. E.g., I don't own these stocks. From what I know, I think I'd be foolish (no pun intended) to get in at these levels. Your thoughts? David