CompuServe Messages

#CBM Loss

    27-Aug-92 06:37:43
Sb: #67323-#CBM Loss
Fm: gary vassalotti 73710,1721
To: Kevin Darling 76703,4227
One of the most basic reasons that Commodore stock is so volatile is the fact that it is a U.S. based company with over 60% of sales registered in foreign currency's. Since it is nearly impossible to predict exchange rates for when the currecny will be translated it is also then very difficult to predict earnings with any accuracy. WALL STREE HATES INACCURATE VOLATILE EARNINGS! So the stock bounces around like a Yo-Yo. Currency hegdging transactions, are by the way, mostly a 'zero sum game,' meaning that if you are good at it, over time you will break even. It does even the earnings out a little, but this time it did contribute to the 21mm loss. I follow Commodore, along with other technology issues, for the bank I work at. (I am an equity analyst.) I think that Commodorer, with a low p/e of around 8, and an estimated growth rate of 10-15% (I think that's what it was last time I checked) seems pretty reasonable, but it is highly volatile, and you must be willing to get out in short notice. My opinion any way. Gary.