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Nautilus Inc. Message Board

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  • astral_tsar astral_tsar Apr 11, 2003 3:53 PM Flag

    successful_01,astral_tsar & samurai_sto

    Erm, john, what we have heah is a failuah to communicate.

    By coincidence, '03 earnings may turn out to be roughly (roughly!) the same as historical '01 earnings. Why were people so happy to pay $30 to $40 for those earnings back then? Dunno. Why are people afraid to pay three times less now for the same earnings? Dunno that either. Do you know?

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    • astral:
      "By coincidence, '03 earnings may turn out to be roughly (roughly!) the same as historical '01 earnings. Why were people so happy to pay $30 to $40 for those earnings back then? Dunno. Why are people afraid to pay three times less now for the same earnings? Dunno that either. Do you know?"

      I'll answer this one for john. It's brainlessly simple to understand. People were paying $30 happily because they believed NLS was GROWING ITS EARNINGS at about 50% per year. Now at 1/3 the price, with the same earnings, NLS is showing serious NEGATIVE EARNINGS GROWTH. People do not care about earnings or profits as much as earnings growth when they own a stock. You have to drill that down into that brain of yours. Don't get caught in the trailing earnings value trap. NLS has one major product (Bowflex). There is only so many they can sell, with retail, lowered prices, and a poor economy. NLS is done unless they come out with a real product, especially with this dividend eating into their R&D money.

      The only way I can be proven wrong is if they can convince America that everyone needs this treadclimber. That is yet to be seen, but I seriously doubt it. Advertising sure isn't cheap right now. If I'm wrong, I'll not only be impressed that they found something to replace the Bow, and I'll gladly admit I was wrong. They can't afford to have just one product anyways. It's way too risky! They need 3 strong products, or one blockbuster one. 3 strong would be better, IMO.

      I hope it's clear now why NLS is in such trouble.

      • 5 Replies to yesthebroker4u2
      • <<I'll answer this one for john. It's brainlessly simple to understand. People were paying $30 happily because they believed NLS was GROWING ITS EARNINGS at about 50% per year. Now at 1/3 the price, with the same earnings, NLS is showing serious NEGATIVE EARNINGS GROWTH. People do not care about earnings or profits as much as earnings growth when they own a stock. You have to drill that down into that brain of yours. Don't get caught in the trailing earnings value trap.>>

        Shh! Don't tell him! I was just planning to sell the man some swampland in Louisiana. You know, it used to be farmland, nice and productive, but now it's sinking into the Gulf of Mexico. What's important to astral is that it used to be good, not that its a worthless POS now and in the future.

        Don't be wrecking precious business opportunities! Capitalize on his ignorance.

      • <NLS is showing serious NEGATIVE EARNINGS GROWTH>

        Surely that should be "NLS has been showing serious NEGATIVE EARNINGS GROWTH". The future is unknown, as it was in 2001.

      • broker/techspk opined: "People do not care about earnings or profits as much as earnings growth when they own a stock. You have to drill that down into that brain of yours. Don't get caught in the trailing earnings value trap."

        This is indeed simple. Lots of things are simple. Communism was a very simple concept. Unfortunately simple ideas are most often useless in the real world.

      • <I hope it's clear now why NLS is in such trouble. >

        Don't be surprised when he fails to understand what you wrote.

      • This is all very theoretical. I'm sure that you read the business press religiously, but that's quite different from actually doing due diligence on your investments.

        In fact this entire thread of short apologiae is reminding me of the long exuberance before the bubble:

        (1) Theory and guesswork take precedence over fact. Logical but farfetched scenarios ("they could go bankrupt! what if they lose lots and lots of money?") are accepted as if they were actually taking place. Beautiful simplicity is favored over ugly information. People are investing based on the opinion of "experts" who are paid for selling their advertisers' stocks.

        (2) The less-experienced investors -- and, needless to say, the business press -- are trumpeting their complete invulnerability. Can't lose! As one of your fellow shorts opined recently: "free money!".

 
NLS
21.09-0.20(-0.94%)Aug 24 4:02 PMEDT