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EMC Corporation Message Board

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  • C78596998785 C78596998785 Jul 10, 2001 4:54 PM Flag

    Disappointed in the market

    Its just my opinion, but the days of the high flying growth and high valuations are done with till the next big stock bubble has ahd a quarter or two under its belt...

    Many companies had great returns in their pension investments during the bull run... and the Fed in its wisdom wouldn't allow those increases to escape taxation. The pension gains lead to overfunded plans and the money had to be diverted back to the companies bottom lines...

    This inflated earning for many companies... taking those earning away left the company in a bad position with comparitive earnings... add to that a tougher environment and in EMC's case a competetive environment in which it appears they will trade off margin and earnings to maintain market share... Key is without the stock market gains a great many stocks will appear to have poor earnings, while maintaining the same old earnings (or less) that their core business returned all along.

    IBM's shark device certainly didn't benefit EMC either..

    I guess my expectation is that EMC will be a good long term hold, but the current price is not cheap by any means... I wouldn't be surprised to see the low under 15, but then again it may hold up better than I think...

    I am long at 31 for a few hundred shares and have sold several 22.50 july put contracts... If the premiums look attractive I'll sell more puts at the 17.50 and 15 dollar levels, but I will probably wait untill the 22.50 close out or the price drops another couple of bucks.

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