| How RIMM Today Mirrors Oracle 2009 Chuck Carnevale submits:Two Great Quarters As everyone knows by now, Research in Motion Ltd. (RIMM) and Oracle (ORCL) both reported excellent operating results. No need to rehash the numbers here, as the information is available in numerous articles and reports already. Excellent operating results from both of these important technology companies is gratifying news. With pessimism so rampant recently, a dose of optimism from the important tech sector is a refreshing respite.Smart investors have long known that long-run performance ultimately comes from strong operating results that generate strong cash flows. Common sense dictates that any business, public or private, ultimately derives its value from the amount of cash flow it's capable of generating for stakeholders. Decades of research on thousands of companies supports the validity of these logical statements.On the other hand, smart investors also realize that stock markets can, and often do, grossly misprice equities over short periods of time. Furthermore, on rare occasions, the mispricing of an individual equity can span a painfully long time. However, inevitably stock prices will, and we believe must, reflect intrinsic value. To paraphrase, you can fool some of the market some of the time, but you can't fool the whole market all the time.Therefore, we've always believed that making investment decisions based on calculating fundamental values based on running the numbers is a sound and reliable way for investors to invest capital. In order to accomplish this important task easily and efficiently, we developed our EDMP, Inc. F.A.S.T. Graphs™, which we believe are powerful research tools that correlate stock prices to fundamental values. We believe that a great advantage that these “tools to think with” provide us is the ability to visually see mispricing when it occurs.Stock Market MispricingThe following proprietary graphs, first on Oracle, and then on Research In Motion Ltd. offer two glaring examples of what we've discussed so far. Furthermore, we would argue that they clearly illustrate that mispricing can occur on either side of the equation. Irrational exuberance, such as technology stocks experienced in the mid-to-late 1990s, present vivid evidence of overpricing based on greed. Conversely, we believe that the current valuation that the market is applying to Research In Motion Ltd. today represents a mirror image of underpricing a strong tech stock based on fear.Figure 1A below looks at Oracle Corporation since 1997. From this earnings to price correlated graph it is strikingly clear how overvalued Oracle's stock price was in 1999 before peaking in calendar 2000. Therefore, the market corrected this mispricing with a vengeance in calendar years 2000, 2001 and into May of 2002. Then, since May of 2002 until current time, Oracle’s stock price has closely tracked earnings growth with only modest and short-lived bouts of volatility.Figure 1A (ORCL) 15yr. EPS Growth Correlated to PriceComplete Story » seekingalpha.com |
Internet Explorer Browser Share Dips As Chrome Rises Microsoft's Internet Explorer, which has dominated the Web browser market since blowing by Netscape in the late 1990s, last month fell below 50% market share. feeds.pcworld.com |
Android Threatens to Make iPhone a Niche Also-Ran Nielsen reports that Android sales are outpacing rival platforms like Apple iOS and RIM BlackBerry--a trend that will see Android continue to gain market share and drive the iPhone into a corner just as the Mac fills a niche role in the PC arena. feeds.pcworld.com |
Study: Macs to Increase Enterprise Market Share 57 Percent Though the iPad is getting its fair and growing share of business adoption buzz right now, it may be time to also shine the IT spotlight on Apple's core computer... feeds.pcworld.com |
Check Point Software Technologies Ltd. CEO Discusses Q3 2010 Results - Earnings Call Transcript Check Point Software Technologies Ltd. (CHKP)Q3 2010 Earnings Call TranscriptOctober 20, 2010 8:30 am ETComplete Story » seekingalpha.com |