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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Charles Tutt who wrote (13443)	12/22/1998 1:33:00 PM
From: RocketMan	Respond to of 74651

<OT> You are right, this is not the right forum, but if you will allow me one last comment to clarify my point. There are any number of "valid," or "acceptable" ways to value a stock, one of which you mentioned. However, one could argue that any such valuation technique is only justifying to someone else why they should be the greater fool. If I wanted to take a company private, I might use the technique you mentioned. If I wanted to know how much I might get if the company went under, I might look at price to book and measure my risk appropriately. However, the fact remains that the typical investor is not interested in any of those things, but only on how much he/she could seel their stock for at some point in the future. That is for all but dividend-paying stocks, from which one could actually live, if one were wealthy enough to have that kind of accumulation. OTOH, if one were that wealthy, the last thing they would be worried about would be dividends. So I amend my thesis: all stocks are based on the greater fool theory ;-)