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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Roger A. Babb who wrote (17676)	3/14/1999 6:44:00 PM
From: Kailash	Read Replies (3) \| Respond to of 18691

"Current P/E ratio: Higher than you think" by William R. Emmons. Nice work at stls.frb.org (you need the acrobat reader). In brief, P/E values have never in the history of the stock market been this high in a bull market; the only precedent is recessions, when investors have reason to think earnings will rebound. Kailash

To: Roger A. Babb who wrote (17676)	3/15/1999 9:37:00 AM
From: Oeconomicus	Read Replies (1) \| Respond to of 18691

Roger, re EGGS, the 51% decline in revenues includes the retail stores in 1997 at $75 million for the December qtr. In 1998, store revenues were zero. Online revenues, OTOH, rose 77% from the year earlier period to $42 million. If you annualize that, the current market value is only 2.25 times sales (before the secondary), low for an e-tailer. They are also fairly sound financially with $59 million of cash and only $38 million of total liabilities, and that's before the new cash from the secondary. Doesn't look like a no-brainer short to me. JMO, Bob