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Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: GraceZ who wrote (8162)	4/18/1999 7:57:00 PM
From: Herb Blair	Read Replies (1) \| Respond to of 29970

The best time to sell is when you have a better place to put your money. H

To: GraceZ who wrote (8162)	4/18/1999 11:00:00 PM
From: High Plains Drifter	Read Replies (1) \| Respond to of 29970

Re: ATHM unique position Doesn't ATHM have what AOL wants, and AOL have what ATHM wants? So do we see any deals in the future? HP

To: GraceZ who wrote (8162)	4/19/1999 3:53:00 AM
From: Gregory S. Wagner	Read Replies (1) \| Respond to of 29970

Grace, once again thank you for the thoughtful response. I agree with much of your analysis regarding INTC and ATHM, and I like your investment approach. I do have a couple of comments though. Your comment: "Intel was priced as a growth company, it had turned into a cyclical." First of all, as a longtime INTC investor, do you think that the diehard INTC longs view INTC as a cyclical? If you look at INTC holdings in some of the more successful sector funds, such as Fid Select Developing Communications and Fid Select Technology, you'll see it heavily invested in INTC (at least that's what it said the last time I looked last week). You know, several years ago when I first comtemplated investing in high tech, it seemed to me that the way to invest was in software, not in hardware. Probably about this time (about '92 - '93) you were starting to make a lot of money on INTC. Then, even though I was using Mac's, I came to understand through first-hand experience how innovation in software was so critically tied to hardware. Now, several years later, I've just acquired new PC's both at home and at work, and the quality of my life has improved substantially with the acquistion of my Pentium 450's. All the applications I use can load and execute so much more quickly. I'm still willing to pay a premium to ensure that I have a reliable, high performing unit. After I got my degree, I worked for P&G, the last several in product development. Historically, Procter is very good at product development, bringing research, marketing, and manufacturing together in a way that has allowed them to provide an endless stream of new products and product improvements, even while they continue to evolve and enter new business sectors. Having left there a dozen years ago, I look back at the company and realize how successful it has been. There are of course many reasons, but without a doubt, I think one of these is it's history of strong management. Another is it's ability to manufacture a high quality product at a profit. The story of how they developed the disposable diaper is a good example of how they could envision bold ideas and most importantly commercialize it. Although they are in completely different business areas, INTC reminds me so much of the Procter I used to work for. Both have been recognized as innovative leaders in their markets, they work hard to maintin this leadership and to make a significant profit for their shareholders. Yet, when I left Procter at the end of '86, I was disillusioned with its "bigness" and the opportunities I saw it miss. I refused to invest any money in this company which I knew so well. It's stock price has gone up by 12-fold in that time, which is pretty good for a company that size, but it's a far cry from what INTC has done in that time which is in excess of a 100-fold. INTC's recent diversification into a variety of business opportuities reminds me very much of Procter's continuous evolution into new business segments which could provide the needed growth in revenue and profit centers. I don't understand the technical aspects of chip manufacturing at all, but it seems to be a bit more complicated than making Pepto Bismol or laundry detergent. I would have thought that there would be significant barriers to entry into this INTC-dominated business. Nonetheless, just as those private label (generic) brands can play havoc with the consumer products giant, AMD certainly has done a number on Intel. I would have thought that INTC is much better insulated from copy cat companies, than seems to be the case from the current chip war. Wouldn't want to own AMD stock, but its chip has been put into a lot of computer boxes in the past year despite their manufacturing difficulties and their inability to make money. I'm truly amazed by this. I just heard on the news that Compaq's CEO resigned this weekend. Who knows, maybe there could be similar shakeups coming at AMD. As AMD, with all of its difficulties, has taken on INTC, with all its strengths, an ugly pricing war with compressed product lives and eroded profits has resulted. Sorry I was so long-winded there, but I'm struck at how the longs on the ATHM thread have very high confidence that ATHM is in such a dominate positon. The more successfulit it is, the more it breeds competition. By the way, as you might have guessed, I'm long both ATHM and INTC. Thanks again for your post. Greg