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

To: Paul Senior who wrote (5687)	1/10/1999 5:57:00 PM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78742

Paul, > Is there a point in time at which > the shorts take over from the longs? In case of IOM, it broke when it did not deliver revenue and earnings growth. AMZN does not have earnings, so it may break down on revenue growth slowdown. AMZN got onto the annualized $1 bln. sales last year. BKS has approximately $2.7 bln. annual sales. Assuming that AMZN does not take over other retail markets (CDs, PCs, beanie babies, etc.), and that it grows to BKS revenue, and that it has to deliver 50% revenue growth per quarter to satisfy the "investors", it will take another year for it to reach the BKS sales. So in this case there will not be a disappointment this year. However, this model is totally baseless. The break may come much earlier or a bit later. If you really want to short it, wait for the disappointment to happen and act then. You will lose ~20-50 points, but you may make money. On the other hand, if you compare Internet to biotech bubbles you'll notice that these break totally on investor sentiment. But they usually don't have neither earnings, nor revenues, so it's a bit different game. BTW, in all questions of shorting, consult John G (https://www.siliconinvestor.com/profile.aspx?userid=93590). He is a professional hedger, and his threads on high-flyers and broken stocks are excellent reads. Personally, I'd rather short broken stock than a high-flyer. But then, I wouldn't short at all. ;-) Good luck Jurgis

To: Paul Senior who wrote (5687)	1/10/1999 10:56:00 PM
From: Circle	Respond to of 78742

Interesting to juxtapose AMZN and TCMS AMZN trades at 130x year 2010 earnings, and only if all goes according to plan. Meanwhile TCMS will consistently throw off 1/3 to 1/2 of its market capitalization in cash annually between now and 2010. I suppose the idea of investing in companies as opposed to stocks has gone totally out the window.

To: Paul Senior who wrote (5687)	1/10/1999 11:01:00 PM
From: jeffbas	Read Replies (2) \| Respond to of 78742

$199 sure looks like that "island in the sky" characteristic of a short squeeze climax top. The stock opens up 25, goes to up 40 and closes nearly unchanged on much larger than normal trading volume. Terrible price action. Time will tell. I would agree that a broken stock is a much safer short.

To: Paul Senior who wrote (5687)	1/11/1999 2:10:00 AM
From: Bob Rudd	Respond to of 78742

Paul: <<point where AMZN should be shorted if we intended to short Can we identify that point?? >> Probably not. Picking tops in high flyers is like trying to pick the exact bottom of a downtrend. That's why the strategy of averaging in with amounts small enough such that the entire trading plan won't put you to the point where you're forced to cover is the best I could come up with. That said, here are a few thoughts on identifying the top: Since this thing is emotionally driven, the top will appear in the technicals well before the fundamentals..Exhibits top formation When it starts to act differently in the face of good news..stays flat or sells off in response to positive news development or some silly prediction.