Path: utzoo!utgpu!watmath!att!ucbvax!UOTTAWA.BITNET!451061
From: 451061@UOTTAWA.BITNET (Valentin Pepelea)
Newsgroups: comp.sys.amiga
Subject: Re: Commodore's health
Message-ID: <8908082241.AA09754@jade.berkeley.edu>
Date: 8 Aug 89 22:29:53 GMT
Sender: daemon@ucbvax.BERKELEY.EDU
Lines: 34

"9123 SAGARTZ, MATHIAS J."  writes in
Message-ID: <21219@louie.udel.EDU>

> Wall Street's reply has taken the stock price from over 19 to 10.25.
> Now the market values Commodore at about 1/3 annual sales and about
> 6 times annual earnings.  These numbers are not those of a
> company that the financial markets have any faith in.  The real question
> is, are things really that bad?  Markets are notorious for over
> reacting but sometimes they know somethings the general public
> doesn't.

Definitely not. The $19 figure was exegerrated, due very much to the expectancy
of CBM introducment of new technology, and the continued growth in sales. The
rise in DRAM prices though had an interesting psychological effect. Computer
prices were not dropping any more; therefore consummers would not get the
periodic imression that suddently they would get a real bargain... an effect
one gets every 6 months when prices fall by 15%. Thus, no more compulsive
buying from the public. And unfortunately CBM is affected even more so since
most of its clients are individuals with small wallets.

But you will notice that trends have continued despite the current slowdown. My
prediction is watch out for this winter. CBM top management has finally seen
the light. R&D money apparently is going up, and the $14 MegaBuck advertizing
budget will satisfy us all.

I predict CBM's stock to hit twenty in February.

Valentin
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