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Non-Tech : Borders Group (BGP) -- Ignore unavailable to you. Want to Upgrade?

To: Still Rolling who wrote (151)	2/7/1999 2:00:00 PM
From: Big Dog	Read Replies (2) \| Respond to of 411

Dear Craig: From your bio you seem to be a very intelligent fellow. Your investment philosophy is to find quality stocks at a discount. I presume that you used this approach to your advantage when Wall Street thought that Oracle and Compaq each had one foot in the grave. A few months later each has performed very well. I would suggest that you use that approach in evaluating Borders, which is financially strong, earning money from popular stores, but has had its first quarter ( in fourteen quarters) that did not exceed its previous comparative quarter. I would note for you that earnings would have exceeded earnings in that previous comparative quarter had it not been for its e-commerce site. I would further note that both AMZN and BKS are losing much more money with their respective e-commerce sites. So, my friend, I would not worry about Borders going out of business. Using your philosophical approach to investing and based upon the financial statistics of Borders (readily available to everyone) and market conditions, you better than most on these boards should be able to determine an appropriate entry point to invest in Borders. Good investing!

To: Still Rolling who wrote (151)	2/7/1999 4:00:00 PM
From: Jacques Tootight	Read Replies (1) \| Respond to of 411

Craig - Borders, at this point in time, is an investment not without risk. There have been a number of posts about how the stock is "so cheap", it a no brainer, it's only one quarter no big deal. I'll submit to you that while the market is fickle and does strange things, it's not totally without reason. Borders stock value has been cut by almost two thirds. Why? To me, the critical point in the analysis of this company are the most current measurement of same store sales. While still positive, they are off significantly from historical levels. This has affirmed to the market the long suspected notion they they are losing market share. Real world stores are losing share to web sales. The market has punished Borders for not being aware of and addressing that threat to their business in time. They are late to the party and the market has said they don't have any confidence in management's ability to correct the situation. Personally, I've been a great fan of the company and a very loyal customer. As a stockholder though I have to look at my position realistically and critically. Management has made some serious errors in judgement, their marketing is very weak, and their own PR has done as much to hurt the company as almost anything else. Sure, these things can all be corrected but Borders is now working from a position of weakness. They are losing market share and that's critical. Now, Borders has been wonderfully successful at obtaining new growth and they will continue to be very aggressive in that area. The new international stores have been extremely successful and they will continue to grow that area of the business. The new airport stores have been good and I look for continued growth there too. The new affiliation with Paperchase may prove beneficial by bringing new products to the stores. The continued development of new Borders superstores will also generate new sales. That said, I repeat the critical point. Same store sales growth are eroding. If new growth does nothing but offset an eroding customer base and market share, you're left with a stagnant company. Borders must reverse this trend and become much more aggressive in the battle for web sales market share. This is how they will be judged, not on their wonderful historical growth. So, will Borders go out of business? No. Will internet sales totally replace real world sales? Never. Just like catalog shopping never replaced real world shopping. But internet sales will be important. If Borders fails to reverse the trend in market erosion, and if they fail to obtain a significant piece of internet sales, they will be destined to become an alsoran. A no growth company in a low margin business. Can you say J.C. Penney? Sears? As someone looking at this as a new investment, look at these things carefully. Don't just look at historical performance, that came easy. Their world has changed on them and has become much more competitive. Thus far they haven't reacted to it very well. Make a careful analysis of the risk/reward here. Some would say this is a no brainer. I'll say it is a full brainer. I think this stock could just as easily be cut in half as it could double in the next six months. The market will be unmerciful if they don't reverse the current trend, and reward it handsomely if they can generate some good news. This isn't a classic contrarian play. This isn't a hammered down company in an out of favor sector like semis were, or steel and oil are now. This is a company that has been punished because the street has no confidence in it. I looked at your profile and to put this in perspective, I'd say that Lukoil is a safer play then Borders right now. Lukoil has less downside risk. Best of luck - RC