To: rogermci® who wrote (4011 ) 5/6/1998 11:42:00 PM From: Paul Senior Read Replies (1) | Respond to
rogermci: re: RDO. Thanks for bringing out that article. I've relooked at my reasons for buying RDO. I can't really justify it to anyone here or to myself just by its numbers. Per Yahoo, the pe is 17 and we're talking a good year. That's high IMO for a very likely cyclical out-of-favor agricultural/construction company. HOWEVER. This guy Offutt sure seems like he can make money. He beats conventional wisdom while doing it too, as I interpret the article. My guess is he will try very hard also with RDO. (Grow vertically and horizontally to overcome the boom/bust ag. cycle perhaps?) If what you say is correct - half of insider buys are by Offutt - then at least some on his team (the other half of insider buys) believe he and they can do well owning shares. My ruling reason for buying stays: which was-- "It's worth it to me to take a small position in this company to see what the top guy can do." In the past, we've had some discussion on this thread about the importance of management. Many of us thought it was the key indicator influencing stock performance. So here is indication that for RDO, at least at the very top, there is one very talented businessman. Further, the stock is near its lows, so maybe (m-a-y-b-e) somewhere around here is a time to buy if you were to bet on the man. I take it as Buffettesque (sorry -g-)in the sense that although RDO is not a wonderful business - stockholders here are able to go partners with a guy who is pretty lucky or smart. And in developing his/our business... it's going to take some time to work out ... like a couple of years maybe. So I agree with you about an RDO thread: We need patience, not posts. (Note please, that as usual I am diversified and RDO only represents a small position for me. But if the stock did crash, I probably could not look at a potato again for a while -g-.) Paul Senior
