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The Coca-Cola Company Message Board

  • TOOHIGH2WIN TOOHIGH2WIN Jul 13, 1998 12:39 AM Flag

    MOTLEY GREATER FOOLS - Don't do what the

    I certainly enjoyed reading "You Have More Than
    You Think" by David and Tom Gardner(copyright 1998).
    The advice in the book was rather conflicting. On the
    one hand we have their version of the Dogs of the Dow
    approach (probably not a bad approach if the whole market
    isn't overvalued). Then we have the buy what you are
    approach (which sometimes gets people in trouble because
    they think that good news about a company they know
    very well automatically translates into higher stock
    prices). Then of all things we have the Obvious Greats
    approach which means we are to buy the greatest stocks (in
    the rear view mirror) of all time. This is a pretty
    easy strategy. Just look at what has gone up the most
    in the past 5 years, 10 years, or since 1919 and buy
    it. It is certainly hard to refute this concept
    because if you didn't buy what went up the most over the
    past 50 years, you were obviously wrong. This was the
    whole foundation of the Nifty Fifty ideas of 1972-74
    and we know what happened then. This was a brilliant
    masterstroke in financial book writing. It reminds me of the
    books on buying real estate with no money down and
    numerous other books that appeared at the top of previous
    financial manias.

    Now what is so interesting about
    all of this is what a difference a couple of years
    makes. In The Motley Fool Investment Guide our Motley
    Greater Fools expound for 18 pages about the Fool Ratio.
    The fool ratio comes about by comparing the p/e ratio
    of a company with the growth rate of a company. The
    book very carefully points out that these Motley Fools
    want to buy a stock when the P/E ratio is 1/2 the
    growth rate. For example, if KO was growing at 50% per
    year, they would want to buy it at 25x earnings. They
    want to look at selling stocks when they have a fool
    ratio of one. In the KO example, if it were growing at
    50% per year they would want to sell it when it got
    to 50x earnings. In addition, they have a chapter on
    short selling that indicates they would consider
    shorting an issue when the ratio reaches 1.4.

    If
    we were to apply their ratio to todays numbers the
    answers are a little ridiculous. Since KO earnings are
    growing at 12.5%, the Motley Fools would be looking to
    short the stock at 17.5x earnings or about $29.00.
    Needless to say, this old fashioned stuff (the Motley Fool
    Investment Guide is copyrighted 1996) doesn't fly anymore in
    this new era.

    Go on to part
    2.

    TOOHIGH2WIN

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • You still don't have an "America,love it or leave
      it!" bumber sticker on your American Motors car do
      you? When we still continue to view the world as how
      it "should be" according to our values then we do
      indeed have a long way to go. I see you don't mind have
      Coke-Cola profit from those lower on the food-chain than
      ourselves... Sit back in your Laz-E-Boy recliner and wait for
      you SS check to clear. I am glad that your generation
      and it's mind-set are fast moving towards extinction.

    • What are the option Aug. 60 sell pts. per unit? If they are high enough, you might want to have a go at them and make some "walking around money". Cash2burn

    • the stocks they showed on CNBC were not KO
      caliber stocks; they were companies whose management
      probably screwed up. So, instead of taking the fall for a
      lousy stock price they say, "Oh, um, someone said
      something on a chat board that wrecked our stock, otherwise
      it would be much higher." Please.

      It is like
      all these companies that blame their earnings
      shortfall on Asia. They will never say, "We overestimated
      what our success would be for the current quarter,"
      instead they say, "Asia really hurt us, if it weren't for
      Asia our earnings would be well above our most
      optimistic projections," or something equally
      worthless.

      BTW, why is it if a bunch of analysts are recommending
      KO there is no alterior motive like they are scared
      that they will lose valuable investment banking
      business if they put out a sell recommendation? Or, maybe,
      they need to keep the price going higher so they can
      get their best clients out and cross them into
      something else? Why aren't these outstanding individuals
      labeled SATAN!! Why aren't they accused of being thieves,
      child molesters, and pimps?

      If you want to take
      the moral high ground, at least be consistent.

    • If you will tell me why a man will post every day
      on the Coke board if he has no stock hates the price
      and will not buy in the next 50 years. you are trying
      to trash the stock so you can cover .You are
      dishonest and you have several names and the SEC is after
      you . You spread false rumors about Buffett selling
      or buying , rumors that you start to mislead and
      confuse , You knowingly post, that there is massive
      insider trading (selling) and you know that is a lie
      (only exercising options ) no I dont like you I don't
      trust you and your gentle nature is a ruse to further
      mislead. These boards do have an effect on the market as
      stated today by the spoksman for the SEC,on CNBC. I hope
      they nail your lying butt. and your alter-ego . They
      showed the Yahoo post screen on TV did you miss it
      ?because you are still here. and all your lying posts are
      still here with your name attached. how many other
      stocks do you trash in a day and what names do youy use?
      Don't be so damn nice when you are picking pockets .
      Your true nature is obvious.
      notbuffett

    • it's your money, you play it as you see fit & best wishes to you and yours. ALWAYS COCA COLA!!

    • I actually like it here right now, as you already
      know I short it with confidence and it can't go up. I
      am keeping some short for August covering. AND on
      top of that I in-out every day. I would have had to
      work harder if the stock was lower, cuz then the risk
      is more.

    • you got a point- BUT THE KO STOCK IS STILL ALMOST 90/SHARE AND THAT MY FRIEND IS REAL REALITY!!!!!

    • I think you're a legend in your own mind!! ALWAYS COCA COLA

    • do you think they are going to announce the split....geez (plus bad earnings already factored in...old news

    • View More Messages
 
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