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

To: Michael Burry who wrote (5640)	1/3/1999 9:46:00 PM
From: Wright Sullivan	Read Replies (1) \| Respond to of 78711

Mike- Related to your Amazon thoughts: Did you see the article in the latest Fortune magazine (1/11/99, page 150) about Buy.com? They sort of take the lowest-cost web seller concept to the ultimate extreme and sell everything below cost, theoretically making all their money from advertising (or something like that). Here's a link from Fortune's web site: pathfinder.com I felt like I was in the twilight zone, or a News of the Weird column while reading it. I don't think it was a joke. It was a lot like that Saturday Night Live fake ad from a few years ago, about a bank which did nothing but change money for customers, two tens for a twenty, etc. The very serious narrator asked, "How can we make money this way? Simple: Volume". A riot, but truth is stranger than fiction once again. No discussion needed on this, but it illustrates just how cutthroat pricing on the internet is and will be. (And I hope I'm not the butt of some Fortune writer's April Fool joke in January.) -Wright

To: Michael Burry who wrote (5640)	1/4/1999 10:40:00 AM
From: jeffbas	Respond to of 78711

Mike, I would have to change my comment a bit to say that a sound short is a vastly overpriced stock where the fundamentals are deteriorating AND ARE GENERALLY PERCEIVED TO BE DETERIORATING. It is quite plain from the chart that the latter is not now the case. If you wait for that to happen you might short at 250 with a far higher probability that it is going to 50 and a far lower probability that it might go to 500 -- in other words, with a larger expected return than by shorting it now. Be careful. I remember well the earlier Resorts International reference. The shorts were absolutely right and got killed.

To: Michael Burry who wrote (5640)	1/6/1999 7:37:00 PM
From: Robert Hoefer	Read Replies (1) \| Respond to of 78711

For all: Is Novacare (NOV) a value stock? Need balance sheet help! I'm sure that value hounds have noticed Novacare's p/e of 3, p/s of .10, low p/b and record low stock price in the $2-3 range. Is it all too good to be true? I've owned the stock before and like and understand what they do (contract rehabilitation therapy) but their balance sheet is not so easy for me. The current ratio appears to be about 2:1. Seems good. Price to book is low, but how much of their book is tangible, i.e. really worth something? I seem to remember a lot of goodwill from the last time I was owned it. Price to sales would be hard to fake. Earnings are supposed to be okay next year, but they are so hard to predict, I'm not trying. Value investors don't need crystal balls, right? I've heard there are convertible bonds to pay off in the near future and the company could default. That would be a major problem, of course. Its debt to equity ratio is somewhat high. Can they handle all this debt and survive? Anyone who has a handle on the financial condition and value of this company is welcome to speak right up! I'm off to check out www.valuestocks.net...!