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Pharmaceuticals and other tech. companies aside, is it really hard to spot winners like McDonald's, Taco Bell, Dell Computers, and the like before their stock takes off? (especially those companies whose services we easily understand)

Wasn't the upcoming success of these companies easy to see? What did people have to say about these companies way back in the day when they first began? "Best Buy is financially strong and is growing aggressively, but there's no reason to think the stock will soar..." (?)

Any thoughts appreciated.

2007-07-03 15:29:25 · 5 answers · asked by Anonymous in Business & Finance Investing

5 answers

If it was so easy.......... don't you think everyone would have done it. What about DEC? What about WANG? Two companies that were in the forefront of the computer revolution. WANG was the number one supplier of word processing to business. DEC was the number one computer sold to the scientific world and only 2nd to IBM in the world.
Where are DEC and WANG today? Gone.

What about WORDSTAR? That was the best selling (and almost only) word processing software. DBase was the best selling "database" management program for years.

Circuit City was at a time doing wonderfully. They also created new business's like CarMax. Look at them now.

The first company with a business DOS was CPM. This was used by the biggest names in personal computers for years.
Microsoft was a #2 miles behind.
Look at Boston Chicken. Krispy Kream. Vonage.
All high fliers with great press. They couldn't lose.


Hindsight is very easy. Yours is excellent.

2007-07-03 16:14:36 · answer #1 · answered by Common Sense 7 · 4 0

I was in and out of Microsoft a few times in the 80's and early 90's and made some decent money. The gains probably would have been moderately better if I had stayed in from the time of my first investment.

Then, I was consistently in Microsoft during the mid 90's, increasing my holding as time progressed. I sold it all on Aug. 1998 and had a big gain.
________

During the 80's and early 90's Microsoft had a P/E of 50 or 55. This is very high & great growth and execution is required at this level. MS nearly always made good on this expectation. However, they had many challenges, not the least of which was their war with IBM over operating systems.

David battles Goliath and wins. An old story, but not the usual one on Wall Street. The risks were very high. Things could have easily gone the other way with a lesser man than Bill Gates at the helm.

Finally, selling MS on Aug. 1998 yielded great returns, but much less than selling in early 2000. Should I feel bad? I've learned recently that "value investors" commonly sell well before the stock peaks. If you really believe that a stock is seriously overvalued, then you should sell it, or sell at least half of it.

2007-07-04 15:40:33 · answer #2 · answered by Tom H 4 · 1 0

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2014-10-06 17:12:13 · answer #3 · answered by Anonymous · 0 0

microsoft was really hard to spot beacause there were lots of penny stock companys that were the same. so you would have had to be very lucky to spot it.
P.S taco bell is owned by yum brands not its own company.

2007-07-04 05:42:22 · answer #4 · answered by jf 3 · 0 0

Yes and no.

Yes - because they all reported exceptional earnings growth.

No - because the views were clouded by opinions. Analysts thought the stocks were overvalued and downgraded them. Investors were chasing "value" from previous bull markets. Skeptics did not think they had a chance...

Great innovative companies emerge all the time. If it is that easy to spot the next big winners, name the three current ones.

2007-07-03 16:09:07 · answer #5 · answered by Anonymous · 2 1

Just to the extremely STUPID People!

2007-07-03 15:37:33 · answer #6 · answered by MRJERK715 2 · 0 4

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