Anyone who doesn't see the value here will just miss the train to making $$. The combined results of their recent and upcoming acquisitions(look at all the small game companies that ERTS can eat up with all their CASH), the current "low" earnings expectations for FY07', AND the Spielberg partnership (to name a few of the catalysts) will come together over the next 2 yrs to push the stock to $70 by the end of 07' or mid 08' at the latest.
BTW, 75% (practically guaranteed) in 2yrs is a pretty dam good annualized rate of return if you have a long-term approach. I'd rather be in ERTS and endure the next 3-5 months of 38-43 than try to get in at 50-55 after the move has started.
Those who don't jump on the train will see get passed by and regret it later. If you don't agree with me then don't buy ERTS, but come back in Jan 08' and well see who was right ;-). Good luck, I'm not worried at all...
Don't short-change ERTS. If they can earn $2/share with a multiple of 50, we get $100. They have always commanded a premium in the past. I think this time is different though. Consumer spending is slowing. Higher energy prices are killing discretionary spending. Higher interest rates are coming. Not to mention higher R&D costs and production costs. I don't think they can earn $2/share. If they prove me wrong, I might buy them at the $50-55 price you point out. I need to see them hit earnings just once first.
The industry is far from recovering, and the p/e is sky high. With a little more market bleeding and some nasty world event ERTS could see $36 in a heartbeat - and the p/e would still be questionable. ERTS has nothing exciting coming out until Xmas 2007, just lots of bills, lots of lawsuits, and lots of flops. Be patient.
I fully agree with systematically buying more in here. I think anyone who is a buyer in the 38-43 range will be well rewarded. It actually may never break 39 but since nobody can call the bottom or top I'm a believer in averaging in now..
Freebies: I also like a position in 2 good oil service/drillers (think hurricanes and Middle East problems over the next 6 months). SBUX, GE, MSFT and PG (yes I said MSFT & PG), are all attractive and should be averaged into as well. Good luck..