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Old 03-24-2005, 07:49 PM   #1
Colin Dunstan
Is papyrophobic!
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palmOne stock - a hidden long-term gem?

Motley Fool (via Yahoo) is analysing the palmOne stock and comparing its relative value to other tech companies. There are some interesting facts about palmOne:

- palmOne gave short-term earnings guidance well below the analysts' expections
- as a consequence, palmOne stock dived about 10% in one day
- sustainable competitive advantage: palmOne makes great products that you have experienced as a consumer
- valuation: palmOne P/E is 13x, well below sector average of 24x; in other words, palmOne stock currently sells cheap!

Is palmOne a promising prospect? I can't answer that question. But by looking past the short term, focusing on what's important, and applying a few of the time-tested frameworks (e.g. EV/FCF, projected earnings growth, ROE, insider ownership), you'll be a lot closer to finding out for yourself.
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