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Technology Stocks : PSFT - Fiscal 1998 - Discussion for the next year -- Ignore unavailable to you. Want to Upgrade?

To: paul feldman who wrote (3856)	12/14/1998 8:59:00 AM
From: Elmer	Respond to of 4509

Hi Paul, The fourth from last chapter of “Classics-An Investor's Anthology,” by Charles D. Ellis, is titled “The Time Tested Maxims of The Templeton Touch.” It cites John Templeton's investment principals. Number 3 and 4 are as follows: 3. It is impossible to produce a superior performance unless you do something different from the majority. 4. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell. My understanding is that the word “hold” on Wall Street is code for “sell.” If my understanding is correct, that chart tells me that we are eighty percent toward Templeton's “maximum pessimism” in PSFT's stock. That doesn't mean it can't go down more. It probably will. But it means that the odds favor superior longer-term performance. I saw something else this weekend that bolsters the pessimism case. Investor's Business Daily publishes relative strength numbers for each OTC stock. PSFT had a relative strength of 6. That means that, during the last 50 trading days, 94 percent of the NASDAQ stocks had better performance than PSFT. No surprise. But I can't remember a first tier software company carrying such a low relative strength number. All of the above said, investing in this stock isn't a sure thing, it's not like death and taxes. All those analysts could be right and the price might head to oblivion. But I know where I feel most comfortable. That's as a long. Regards David PS the book is worth a read