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Nam Tai Electronics, Inc. Message Board

  • Name_not_important Name_not_important Aug 12, 2003 9:25 AM Flag

    A cautionary note

    I seldom post because it does little good, but occasionally the claims on these message boards become too dangerous to ignore.

    I have been in and out of this stock for years--mostly in. It is the single biggest winner in my personal investing history. As far as I can remember, eggtrader is the only person on this board that may have been here longer than I have.

    I have never shorted a stock and never will, and I don't care for paid bashers or short sellers in general, but I ALSO don't care for hypesters, and this board is rife with them.

    Some of you newbies who think you have found the philosopher's stone which will turn your lead into gold are about to receive a few very rude shocks. (Of course, many of you are hypesters who won't be shocked at all, but the tone of some of these posts smacks of the novice investor.) Tbe market will not long accord this stock a 15 earnings multiple, let alone 20 or 30. I first bought a large amount of NTE (then NTAIF) when it could be had for less than the cash in the till. Those days may not come again, but the present price level is ridiculous and unsustainable. This IS a Chinese company, albeit a good one.

    One of the things some of you will discover to your chagrin is that this company does not play the earnings management game well. To me, that's always been a plus, because most manic-depressive American investors, despite whatever they say to the contrary, can't STAND downside surprises, which consequently produce great buying opportunities. You will get them here, along with upside surprises, and you will be astounded and dismayed at how fast this stock can sink after the next BAD quarter is announced (whenever that may be).

    The recent runup seems to have occurred when the stock-splits-create-wealth crowd (wrong) took over from the NYSE-listing-is-good-for-the-price crowd (wrong again), and was then bolstered by the one-excellent-quarter-can-be-extrapolated-forever crowd (probably bought Oracle at its peak). The inevitable drop after listing was serious enough to have occasioned the usual lawsuit from the ambulance chasers of the securities market. The next drop will make that one look tame.

    If you are the unusual "buy it and hold it forever" investor, you'll PROBABLY do all right here, regardless of the entry price, but then I don't know what you're doing on a stock message board or why you would be bent on paying up big time for this investment. You really belong in GE, checking the price once a week.

    If you're trying to learn the trading game, be forewarned. This stock never even touched 15 until a month or so ago. Talk of valuing NTE at 25 or 50 is just hot air. Hey, how about 1,000, as long as we're selling rosy outlooks?

    Experience indicates that few will pay any attention to this message, but I'll tell you this: anyone who says I'm a paid basher or a short is after your pocketbook, big time, and you had better be pretty leery of what he says. I'll probably be back in NTE at some point when the price is right, and I'd love to get your expensive shares at $10 - $15. Just don't let me do it, or you'll be very unhappy.

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    • And you know what, I'm sick of people looking at ten-year historical data on NTE to predict future multiples. Until the last 18 months or so, this company was NOT A GROWTH COMPANY. If you don't grow, you don't get high multiples. Now NTE is showing signs of transforming into a growth company. So the fact that they always had a 10 multiple is meaningless right now. That was a different company. It shouldn't have a 40-50 multiple, and it defintely shouldn't have a 10 (this isn't a god damned utility company!). It's somewhere in the middle and the market will decide going forward, not by looking back.

    • <"market will not long accord this stock a 15 earnings multiple, let alone 20 or 30. ...the present price level is ridiculous and unsustainable. This IS a Chinese company... ...be forewarned. This stock never even touched 15 until a month or so ago. Talk of valuing NTE at 25 or 50 is just hot air.">

      Thankyou, veteran Nam Tai Trader Name_not_important, for a dose of reality.

      Let's hope they listen before their experience matches that of the LIFE IS OVER post.

      <"you will be astounded and dismayed at how fast this stock can sink after the next BAD quarter is announced ">

      YOU HAVE BEEN WARNED!!

      <"The recent runup seems to have occurred when the stock-splits-create-wealth crowd (wrong) took over from the NYSE-listing-is-good-for-the-price crowd (wrong again), and was then bolstered by the one-excellent-quarter-can-be-extrapolated-forever crowd (probably bought Oracle at its peak). The inevitable drop after listing was serious enough to have occasioned the usual lawsuit from the ambulance chasers of the securities market. The next drop will make that one look tame.

      ... I'll probably be back in NTE at some point when the price is right, at $10.">

      LOOK UP "CASSANDRA" IN THE DICTIONARY, HUDSUCKERS!

    • <I seldom post because it does little good, but occasionally the claims on these message boards become too dangerous to ignore.>.

      i really liked your post.

      < Tbe market will not long accord this stock a 15 earnings multiple, let alone 20 or 30. I first bought a large amount of NTE (then NTAIF) when it could be had for less than the cash in the till. Those days may not come again, but the present price level is ridiculous and unsustainable. This IS a Chinese company, albeit a good one.>>

      what would your guess be as to an average p/e for NTe, based on your experience?

      <One of the things some of you will discover to your chagrin is that this company does not play the earnings management game well. To me, that's always been a plus, because most manic-depressive American investors, despite whatever they say to the contrary, can't STAND downside surprises, which consequently produce great buying opportunities. You will get them here, along with upside surprises, and you will be astounded and dismayed at how fast this stock can sink after the next BAD quarter is announced (whenever that may be).>>>

      good to know. i will porbably add when it drops a lot...thank for the warning.

      <If you are the unusual "buy it and hold it forever" investor, you'll PROBABLY do all right here, regardless of the entry price, but then I don't know what you're doing on a stock message board or why you would be bent on paying up big time for this investment.>

      i am trying to a be a buy-and-hold! i�m, still farily new to investing. i got in at 11 in post-split terms, so i am comfortable with drops to 15. as far as mesage boards, i work at home...it can be a fun way to pass time, and on certan boards i have learned a tremednous amount about this or that stock and investing.

      <anyone who says I'm a paid basher or a short is after your pocketbook, big time, and you had better be pretty leery of what he says.>

      well, to me, you seem not at all a basher, let alone a paid one.

      • 1 Reply to randywoolf
      • Sorry, I really can't pretend to know the answer to the P/E question. One used to be able to pick this up all the time for less than 10, but there are many more people much more aware of the company now, and I have no idea where it might settle. I just (think I) know that it won't be at the current levels. Some of this newfound trading volume will dry up when the stock slips. It's still a Chinese company, with all the risks inherent in that situation.

        After the next downturn, and assuming the company is still a sound investment, I'll simply start buying when it seems the downturn is over. Usually I'm wrong and end up doing this several times before the true bottom is reached. I do the same thing selling on the upswing. Excellent timing is not one of my hallmarks.

        I like the company, and the stock has treated me more than well, but when I start seeing "...this can only go up..." and "...to the moon..." preceded by a 100% price rise, then I absolutely KNOW that it's time to stop buying and think hard about bailing out. In this instance, I sold way "too soon", but I made a more than adequate return, sleep very well, and feel from experience that I'll get back in a LOT lower. If I don't, so be it. The big money here has been made for now, and won't be available again (for the short term) unless the price drops as I expect.

        As for buying and holding, it's fine as long as you realize that every day you make that decision anew. For the very long term, see the {pseuodnymous) Adam Smith's The Money Game, truly a book for all investment seasons.

    • Get off this board.You are speaking with common sense.Let the new idiots who think they found the next MSFT learn on their own they just paid up for a commodity producing contract manufacture.Koo you and I know this company's true value.It is a great little and I mean little company that has had a great year.

 
NTE
7.020.00(0.00%)Apr 21 4:00 PMEDT

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