Linked by Howard Fosdick on Thu 24th Nov 2011 00:04 UTC
Editorial My previous article described how you can use your tech knowledge to profit from the stock market -- if you combine it with financial analysis and careful research. This article analyzes several tech stocks. The goal is to start a useful discussion. What is your opinion of these companies? Even if you don't invest, this matters if you are in employed in IT. You're betting your career on the companies in whose products you specialize! You don't want to pick losers.
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Wanna bet?
by Carewolf on Thu 24th Nov 2011 00:45 UTC
Carewolf
Member since:
2005-09-08

None of this analysis is new or surprising which means the conclusions is already factored into the price.

Oddly enough in the current economy betting at random is more profitable than betting analytically. I wouldn't advise that to anyone, but still, let us check again in a year and see how these recommendations have turned out?

Edited 2011-11-24 00:46 UTC

Reply Score: 4

Nice article
by tomcat on Thu 24th Nov 2011 01:31 UTC
tomcat
Member since:
2006-01-06

Thanks for posting it.

Reply Score: 2

ANother view
by kateline on Thu 24th Nov 2011 01:58 UTC
kateline
Member since:
2011-05-19

Dell - better than you think. They have a respect now in the data center they didn't have 8 or 10 years ago. I think they're closing in on HP and IBM.

Microsoft - will grow. They're smart and they got the bucks.

HP - well, one we agree on. I wouldn't touch them with a 10 foot pole.

Reply Score: 1

RE: ANother view
by sergio on Thu 24th Nov 2011 04:32 UTC in reply to "ANother view"
sergio Member since:
2005-07-06

I don't think HP is doomed, their services division is very strong (former EDS).

Reply Score: 2

Make money by work.
by spiderman on Thu 24th Nov 2011 07:27 UTC
spiderman
Member since:
2008-10-23

You want a good return on investment? Then work hard. Invest the money you earned (earning means you worked for it) in a good house, a good car or a good bicycle or something useful. That is what real life is about guys.

Reply Score: 4

RE: Make money by work.
by edogawaconan on Thu 24th Nov 2011 14:08 UTC in reply to "Make money by work."
edogawaconan Member since:
2006-10-10

You want a good return on investment? Then work hard. Invest the money you earned (earning means you worked for it) in a good house, a good car or a good bicycle or something useful. That is what real life is about guys.

Apart of house and gold, most things actually decrease in value over time, don't they?

Edited 2011-11-24 14:09 UTC

Reply Score: 1

RE[2]: Make money by work.
by testman on Thu 24th Nov 2011 23:13 UTC in reply to "RE: Make money by work."
testman Member since:
2007-10-15

Apart of house and gold, most things actually decrease in value over time, don't they?

In Australia even housing is dropping.

Reply Score: 2

RE[2]: Make money by work.
by spiderman on Fri 25th Nov 2011 07:13 UTC in reply to "RE: Make money by work."
spiderman Member since:
2008-10-23

Gold has zero value until you use it to do something useful, housing has no value until someone use it to actually house himself and Money has no value until you spend it to buy something useful. The money you earn has a lot more value than the money you win or steal. You may buy less things with only the money you have earned but those things have more value because they will make you happier and they don't taint your soul.

Edited 2011-11-25 07:14 UTC

Reply Score: 3

RE: Make money by work.
by Neolander on Sun 27th Nov 2011 19:50 UTC in reply to "Make money by work."
Neolander Member since:
2010-03-08

Same here.

Also, I have no respect for people who have so little affection for their company that they can go around selling shares of it to complete strangers who are only here for the money. I wouldn't encourage such business by buying such shares.

Ask me for X amount of money that you promess to reimburse in Y time with Z interests, it's alright, but stocks... No, thanks.

Reply Score: 1

Comment by Zaitch
by Zaitch on Thu 24th Nov 2011 13:26 UTC
Zaitch
Member since:
2007-11-23

Sorry to be a pedant but you should disclose whether you have an interest (holding) in any of these companies. Otherwise I enjoyed these summaries!

Reply Score: 0

RE: Comment by Zaitch
by benali72 on Thu 24th Nov 2011 19:09 UTC in reply to "Comment by Zaitch"
benali72 Member since:
2008-05-03

Read the 3rd paragraph, it does exactly what you ask.

Reply Score: 2

$20 Dollars
by hackus on Thu 24th Nov 2011 19:09 UTC
hackus
Member since:
2006-06-28

1915...$20 Dollar Gold 1 ounce piece bought:
1) Nice Hat
2) Nice Suite
3) Nice Shoes
4) Money left over for a night on the town.

2011...$20 Dollars (minus the Gold) paper bill

Dinner for Two at Fast Food joint and very little else.

2011...$20 Dollar 1915 1 ounce Gold piece will buy:

1) Nice Hat
2) Nice Suite
3) Nice Shoes
4) Money left over for a night on the town.

-Hack

Reply Score: 0

RE: $20 Dollars
by vaette on Fri 25th Nov 2011 15:20 UTC in reply to "$20 Dollars"
vaette Member since:
2008-08-09

$20 invested in the Dow Jones Industrial Average in 1915 would be well over $4000 today.

Not completely sure what point you were shooting for, but if your point is that keeping your savings in cash is a bad idea then I would say the same for gold, especially since the prices do look distinctly like a bubble at the moment.

Reply Score: 3

RE[2]: $20 Dollars
by hackus on Fri 25th Nov 2011 20:32 UTC in reply to "RE: $20 Dollars"
hackus Member since:
2006-06-28

I call your BULLSHIT and raise it 1 ounce of gold.

Oh really? $4000 dollars.

What company stock would that have been?

The stock Market went bust in the 20's/30's. Most stock went to zero or less.

What kind of Genie in the bottle fantasy are you talking about that would give you the foresight to pick a company 100 years in the future and the stock or even the company would still exist?

Most companies and stocks over the past 100 years have gone bust. How about that Blue Chip GM stock?

BUST. Seen Detroit lately? BUST.

Destroyed, utterly.

Looks like 1945 Dresden Germany after it was fire bombed into oblivion.

So what risk would you pick? Picking a stock that would survive 100 years for $4000, or One ounce of Gold you can keep in your desk?

You can bet your bottom dollar Gold isn't done with its current market rally either. Once the huge swings in the market are brought down by people losing vast sums of stock value, and selling their gold to cover that loss.

Gold is going to rocket to the moon.

Especially when you got crooks running everything. People are already leaving in order to protect just the hard work they have invested from Bankers, IRS and other thieves.

-Hack

Reply Score: 0

RE[3]: $20 Dollars
by vaette on Sat 26th Nov 2011 02:17 UTC in reply to "RE[2]: $20 Dollars"
vaette Member since:
2008-08-09

I was very explicit about the specific investment, buying balanced into the Dow Jones Industrial Average index, which started the year 1915 at about 53 points (http://stockcharts.com/freecharts/historical/djia19001920.html), and ended trading today at 11,231.78 points. This comes out as a gain of 211.92x the money, which at an initial investment of $20 would give you $4,238. Now you would lose some money here in rebalancing the investments to fit the index, but in the short-term movements are almost random (and the index constituents change very slowly) so not that many reinvestments would need to be made. Certainly it would take a very boneheaded strategy to not handily beat the gold price of $1681 today (the price was indeed around $20 an ounce in 1915 as you point out).

I additionally personally believe that gold is in a bubble which is about to deflate whereas the stock market is more or less fairly priced at the moment.

Reply Score: 3

RE[4]: $20 Dollars
by spiderman on Sat 26th Nov 2011 08:15 UTC in reply to "RE[3]: $20 Dollars"
spiderman Member since:
2008-10-23

Actually, the price of the dollar was fixed against gold until 1976 ("the gold standard"), so the price of an ounce of gold didn't change until 1976. Then the price of gold didn't go through the roof, it's the dollar that fell bellow the floor. Every 40 to 50 years we need to change the money system because it is not sustainable. Our financial system leads to cycles of over production and depressions, each one worse than the previous one. When things are becoming unbearable, we change the system with a new deal or a world war.

Edited 2011-11-26 08:17 UTC

Reply Score: 1

RE[4]: $20 Dollars
by hackus on Sat 26th Nov 2011 19:17 UTC in reply to "RE[3]: $20 Dollars"
hackus Member since:
2006-06-28

Good God.

You have it all backwards.

Gold never changes in value, unless of course, something happens that makes it irrelevant.
(The Apocalypse or the Second Coming or Nuclear War, Asteroid Impact.)

But then, if that happens, who cares about Gold, or anything for that matter.

The only thing that changes with respect over time, as I demonstrated in my first example of a Suit and a night on the town, is the value of _everything else_ with respect to Gold.

Gold _never_ changes in value, ever.

It has been that way since recorded history.

Gold is money, despite what Bernanke and his crony thieves on Wall Street tell you. Bernanke stood up in front of Congress in front of Ron Paul and told him Gold,..._GOLD_ is not money and that it was an asset.

Besides, if you could print paper, and give it too all your crony friends as money, OF COURSE you would say Gold is not money. You would _NEVER_ want Gold to be money because you can't print it and give it too all your friends and make your selves SULTANS while everyone else goes on food stamps!

I almost laughed myself into oblivion, after reading you think Gold is in a Bubble.

A Bubble!

I bet all those MF Global, GM Investors, MCI, Enron...(Sorry list is too long here...) investors thought Gold was in a bubble too!

Now they are sitting on a street corners with no pot too piss in!

Please, please join them!

LMIO

-Hack

Reply Score: 1

RE[5]: $20 Dollars
by vaette on Sun 27th Nov 2011 10:43 UTC in reply to "RE[4]: $20 Dollars"
vaette Member since:
2008-08-09

The only thing gold doesn't change in value against is gold. The fact that the price of gold is relatively stable when considered over vast periods of time is a bad thing when considering investing your savings, since as noted gold has lost value against the Dow Jones Industrial Average.

Also, this is a fact despite gold being at a historical advantage in this comparison at the moment. If we had instead looked at 2001 you would have gotten a mere $400 for your ounce of gold (when adjusting for inflation into 2011 dollars), a mere fourth of the current value which you claim to compare well to the 1915 value. As a comparison the Dow closed at a little bit over 10,000, a mere ~13% lower than today.

So gold is not at all stable short-term, and the long-term is more favourable towards broad stock market investment. This is a pretty direct consequence of another fact; Gold is not very inherently valuable, and the pricing comes down to human follies and investors speculating. This is something that stock investments don't suffer from to the same extent, since there is a physical company, usually with physical assets, making sometimes physical products, underlying the stock.

Reply Score: 2

RE[3]: $20 Dollars
by unclefester on Sat 26th Nov 2011 08:56 UTC in reply to "RE[2]: $20 Dollars"
unclefester Member since:
2007-01-13

Try reading some financial history before making such idiotic comments.

Every $10 share in Coca Cola issued in 1917 is now worth over 100,000 (after accounting for splits).

Of the original 20 companies in the Dow Index 19 are still in operation (most are now under different names). The only company that is no longer trading is US Leather. US Leather was voluntarily wound up in 1956 and the company assets returned to shareholders.

Major American corporations over 100 years old (some have been renamed):

Exxon
Caltex
IBM

The following major corporations were all founded before 1850:

Wells Fargo
New York Times
Western Union
Reuters
Macy's
Corning
Levi Strauss
Aetna
Berkshire Hathaway
Proctor&Gamble
John Deere
Colt
Du Pont
Amtrak

The massive Japanese conglomerate Sumitomo has been operating continuously since 1590.

Reply Score: 3

RE[4]: $20 Dollars
by hackus on Sat 26th Nov 2011 19:58 UTC in reply to "RE[3]: $20 Dollars"
hackus Member since:
2006-06-28

For every 1 that has been successful, I can name 10 that went broke.

I would like to point out, that over the years, through currency inflation, and revaluation/destruction of the currencies, those calculations are far from correct.

Particularly in the case of your 1500's Japanese company example.

Ironically, every one of those currencies when those companies were either created or destroyed, were re-evaluated in...

_GOLD_

For the companies, countries or institutions you cite.

Good try though.

You know, there is a good reason why Gold is at $1600 or so an ounce right now. It isn't because people think the worlds gonna end.

It isn't because people are Gold bugs, and it isn't because gold is in a bubble.

People are buying gold because they are seeing FACTS of the situation:

1) The Robber Barons have returned, and they want all the money YOU STOLE from them. They want your car, your house, your bank account balance.

_EVERYTHING_.

They are getting it too, just read the paper. Watch your congress pass laws that make them able to seize just about anything they want.

They are even taking peoples homes they don't owe a dime on!

2) With corruption, comes destruction. Historically when these types of people arrive on the scene, the currency goes to shit.

That means after you work hard all day long, next year your hourly wage buys less.

I don't want to work the same hours and earn less than I did last year. I want to keep what I earn, and I want it to buy stuff I need, no matter how long I keep my money.

3) Governments get desperate.....no, historically when these Robber Barons return, they get brutal and they steal _everything_ they can get their hands on.

Gold provides a way for you to save what you have even after they sieze your house and your property.

A good example is in Germany when they experienced war and currency collapse. 1 ounce of Gold kept hidden safely, bought 1 families safe trip over the german border into switzerland.

Why? Because some soldiers can be bribed, in exchange for not shooting you if you give them gold. (In the US, we don't have soldiers on the street corners....._yet_.)

There are so many historical lessons for owning gold over paper money, I really don't understand why people have such a hard time with it.

Also, I would like to point out, most people who own Gold right now, use to own stocks.

They got out, because they now understand the system is being run by criminals, and cannot be trusted to hold their investments for a long length of time safely.

In 2002 I use to own a 401K, but I understood what was happening, and I paid the _substantial_ penalty and bought all gold and silver with it.

In closing, the other historical aspect to this is, deja vu. This is a cycle. Once the government is replaced, and the thieves are removed from finance, naturally we will see a return to honest investing.

That is the good news. Then Gold and the new currency will be revaluated, and buying stocks and owning less Gold will be in vogue again.

The bad news is, historically, that only happens after huge depressions, and world wars that follow from them.

I doubt this time will be any different.

-Hack

Reply Score: 0

RE[5]: $20 Dollars
by unclefester on Sun 27th Nov 2011 09:19 UTC in reply to "RE[4]: $20 Dollars"
unclefester Member since:
2007-01-13

I suggest you read this before commenting further.

http://en.wikipedia.org/wiki/Gold_as_an_investment

If you bought gold in 1980 you would be 25% down in real terms.

If you bought Dow indexed stocks in1980 you would be up 600% in real terms.

Reply Score: 3

Career Choices Hinge On This
by benali72 on Thu 24th Nov 2011 19:11 UTC
benali72
Member since:
2008-05-03

I don't much care about stocks but I definitely do care about my career. I got one good take-away from this article. To make good career choices you have to consider company fanancials and overall success, not just their products.

Reply Score: 3

Uh...
by kurkosdr on Mon 28th Nov 2011 07:45 UTC
kurkosdr
Member since:
2011-04-11

In order to make money from stocks, you need 3 things

a)Know the companies you invest into (let's assume that due to our geeky nature, we got that coverred for tech stocks, though we really don't).

b)Knowledge of economics (a real degree, not pretending to understand economics like Eric S Raymond)

c)Knowledge of how the stock market works (when to be bearish, when bullish, how to short etc)

Most geeks fail at b and c.

Edited 2011-11-28 07:51 UTC

Reply Score: 1

Comment by kovacm
by kovacm on Tue 29th Nov 2011 10:36 UTC
kovacm
Member since:
2010-12-16

Microsoft - as time pass, desktop PC will only lose market share, I am sure it soon will start to shrink and same goes for Microsoft cashcow! if they do not find any other stream of revenue anytime soon than best solution is:

"shut it down and give the money back to the shareholders."*


*Michael Dell, Dell's CEO

same goes to Intel: if they do not find way to get into handle market, ARM and others will be new kings and intel will be king of shrinking desktop market.

Reply Score: 1