Tuesday, November 08, 2005

Skinny Dippin': Jump In When No One Else Will

Market leaders don't die easy.

If is stock is dead (not moving) it doesn't mean it's dead money -- it just means its hibernating.

When the Street unlocks an equity's true, hidden value -- value that no one wants to acknowledge (a bullish analyst report, a EPS surprise, or a favorable lawsuit outcome) -- the stock price naturally gravitates higher.

Let's demystify the sex, for a minute, because that's all Wall Street really is: a throng of very desperate people acting on precarious information.

Those desperate people are also rational investors financing the next Home Depot or Microsoft (MSFT).

It's Wall Street's greatest puzzle trope: hyseteria masquerading as math.

There are currently 9,000 stocks available for investors to munch on -- no way on God's green earth all the information we need to know about each one of them has been fully priced or factored in.

Market leaders fall into bases and they do so because short termers take profits -- if you really believe in the company -- you'll buy on the dip.

Pfizer (PFE), which got mauled recently, rebounded after ricocheting off the $20 dollar level.

So we bought a block of it for our personal account.

PFE is a market leader that's hit maturation, plain and simple.

One look at Pfizer's carrion flesh can be veritably nauseating -- the generic drug worms are throwing a feast.

On patent, two patent, three patent...go!

PFE's vulnerable, yes, but she has her loyal following.

We ask: Will Pfizer turn out to be like the prettiest girl at school, the one whose paramours flee momentarily only to return home?

When will this demented popularity contest end?

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