Vendit - STOCK FOR THE NEXT 5 YEARS: CMGI, IMO. Thanks for your many informative and helpful posts. Here's my 2 cents re: Q posed for the stock for next 5 years: CMGI
Rationale vs. AOL: main one - MARKET CAP. AOL at 100 billion plus
vs. CMGI +/- 10 billion. Very hard to escape the mathematical and real world limitations of exponential growth. This is something even the grand behemoth of all time, MSFT, has to contend with (a sensational stock, not my favorite company).
FWIW Due to explosive growth, CMGI is 25 % of my current portfolio.
AOL is second at about 12 to 13 % -- first bought Nov. 1994 with 6 splits since then and likely 7th not to far off in future. No plans to sell either one. In an earlier post re: AOL vs. CMGI, I referred to CMGI as having some "jackrabbit" moves left with AOL being the "tortoise" -- (some tortoise) -- "graduating" to steady, reliable, superior, "blue chip" LT growth in a dominant position. Don't expect share price deterioration per se but do expect decline in earnings / share price growth rate with gradual multiple contraction over time. Still will be a buy and hold, hold, hold stock IMO.
Would expect CMGI to triple or quadruple market cap before AOL doubles again -- this is one time I would be very, very happy to be wrong.
CMGI: Due to business model as incubator / spinoff VC company now with plans for expanding more as operating company, valuation is more difficult and certainly debatable. Nonetheless, looking at wholly owned and affiliate companies (now around 44) with continuing stream of IPO's imminent and on the horizon, feel CMGI is THE PREMIER LONG TERM, HIGH GROWTH, DIVERSIFIED, PURE INTERNET PLAY -- no stock selection or sector or category rotation necessary, as I described in a recent CMGI post. Other VC / spinoff / IPO plays are out there but nothing quite like CMGI business model, plans for further expansion - extension. Building steady momentum as IPO / business plan magnet; creating businesses where none are presented for the identified link in the internet "value chain."
INVESTMENT BIAS: internet, broadband, telecommunications
FWIW: my stocks in the next tier down -- 2 - 3+ % weighting:
YHOO, WCOM, EXDS, INKT, DCLK, CSCO, BRCM, ATHM (+ XCIT), VRSN, RNWK, INSP, SFE, QCOM, T (via TCOMA & UMG)
Next notch down: + / - 1 - 1 1/2 %: CNET, EMC, GNET, NOKA, NSOL, SPLS, UNPH, QWST, LCOS, USWB, SONE, MFNX, NITE, SUNW, WCAP
Beyond that: a few dozen others striving to separate themselves and move up the market cap chain to the head of the class. Nothing more enjoyable than welcoming and appreciating "new graduates !"
Last tip of the hat to AOL -- definitely, for me, THE STOCK OF THE LAST FIVE YEARS: hard to match 6 splits !!!
Sorry for the long post --
Good luck and thanks again, Vendit.
George Martin |
