Alleyba knows no stock goes straight up. Selling the latter part of the day was most probably some profit taking and investors being scared and not understanding the fact that the increase in the short position will only benefit us in the end when they have to scramble and start covering. Stock up everyday past 9 days in light of crappy market. Needed to fill in a little here. Alleyba would not be surprised to see some positive announcements in the next couple of weeks. Alleyba also added to his position today so that should tell those who follow Alleyba's posts that good things are about to come. Finally...I have not seen Scandals and Deu Dilligence lately. I think they took their profits and baled out. Scandals..Deu.. please respond.
3. P/book is used in merger and acquisition analysis. P/books are also used by some analysts and trading strategies that, as a rule, preferentially recommend stocks with low P/book ratios. A PEG does not shield from that preference. There are Vanguard mutual funds that favor stocks with high PEG ratios and those that favor stocks with low PEG ratios. So I guess it depends on risk tolerance and preference. High P/books also really don�t mean too much for widely recognized proven winners, but we�re not there yet. But there are many people who do not buy stocks with high P/book values and I don�t think DHB should shun them away if there is something the company can do to increase that exposure.
4. Everybody knows that many firms don�t put out recommendations on stocks less than $5. As the Fool might say �The majority of companies that trade in this territory are destined to mediocrity or even bankruptcy. Be EXTRA leery with this one.� I think that a higher book (shareholder) value acts as a hedge against that leeriness, whereas you may say that the higher growth rate acts as the hedge because it decreases the PEG.
5. I don�t figure out P/book ratios either. I just use what is commonly available. I guess I could use a calculated PEG also, but PEGs can mean different things depending on the size of the company.
It seems that your last statement might be a variation of �Arguments Against Fundamental Analysis� although you use fundamental analysis. �Those who do not use fundamental analysis have two major arguments against it. The first is that they believe that this type of investing is based on exactly the kind of information that all major participants in publicly traded markets already know, so therefore it can provide no real advantage. If you cannot get a leg up by doing all of this fundamental work understanding the business, why bother? The second is that much of the fundamental information is "fuzzy" or "squishy," meaning that it is often up to the person looking at it to interpret its significance. Although gifted individuals can succeed, this group reasons, the average person would be better served by not paying attention to this kind of information.� http://www.fool.com/School/Basics/InvestingBasics006.htm
No offense taken, and none meant in return. Your points are good ones. And this wouldn�t be so long winded except that it made me relook at why I don�t use the PEG ratio.
In summary, I think that everybody over time develops their own investing style and learn to rely on their own favorite indicators.
It�s taken me a while to respond. I read the message boards pretty often but don�t have too much time to post. That might get better in the future. In any case, I am glad someone with your experience invests in the stock and takes time to post to the board.
Alleyba�s list of possible events seem right on the mark.
I agree that some sort of pullback was due- but was becoming increasingly concerned about missing the boat for a few pennies/share.
Try this search� at least 100M market cap (so it�s a real company), 20% 1 and 3 year Revenue growth, company with any amount of long term debt (some degree of leverage), at least 20% ROE (making some use of it�s money). I use qwikn. Search isn�t all that easy to find.
This company is undervalued.
From what I can see this company has made all the right moves in the past year. If management wants to be able to capitalize on past granted options they will have to push the stock price up. A start would be to increase book value. So that�s what I�m watching as a common shareholder. I think the restructured debt will prove to be even more beneficial as time goes on.
Fundamentally, I think this is a great stock� and it�s a great story. It will get even better as long as management: Works to decrease P/book by increasing book value. Convince employees that it is better to support the company rather than to give into unions.
I�ll be accumulating this stock no matter what. If the price goes down, so much the better. I haven�t seen anything this good in a long time. Will probably buy BBY again in the fall.
I think there will be a slow rise to 7, then institutions become really interested. That will give big players that don�t commit to stocks under 5 at least a 25% margin. JMHO.
In at 3.80 and 4.36.
Consider my shares not for sale for a long time. Congrats to all those that got in on this early.
I won�t be voting to approve options for management/employees any time soon (as if my shares would make a difference). Hey, if they believe in the company, let �em buy �em like I do.
Insider activity isn�t looking great to me though�looks like a lack of confidence.
Scandals and Deu Dilligence�possibly deployed?
Don�t think we�ll be able to spot today�s dip on a 3 or 6 month chart.
<<<< From what I can see this company has made all the right moves in the past year. If management wants to be able to capitalize on past granted options they will have to push the stock price up. A start would be to increase book value. So that�s what I�m watching as a common shareholder. I think the restructured debt will prove to be even more beneficial as time goes on >>>>
Sapro, How are you so sure that the way to increase the stock price is by increasing book value in this company? In order to make that statement, you have to know how much weighted avg debt and equity (WACC) is costing DHB.
See, if you lower debt too much, you will decrease EPS (since you will miss the benefit of tax deductibility by using equity alone), and it will cause a decline in the stock price. Only the right mix, will make DHB stock price go up.
So, I'd say let the guys do what they think is appropriate. Only they know what the strategic steps for the future are and what's in pipeline, and what financial structure is best to achieve these goals. IMHO.