Go to Jeff Salisbury LWGate Home Page.From: "NANCY POLCARO" <ZILLAGIRL@msn.com>
Subject: Re: [CANSLIM] Fundamental Philosophies
Date: Thu, 5 Dec 2002 22:03:44 -0800
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I would just like to put in my opinion if possible. For people who are j=
ust learning the IBD system and doing all the wrong things and not making=
money(especially in this market) it is a big expense-on top of no profit=
s and maybe losing money. For people who have traded for 40 years and ha=
ve their own web site and know Bill O'neil personally, I'm sure it is wel=
l worth the money. I think the problem is -how do you learn the system =
when you have no stock market background unless you pay that much money=
just to try to learn. I had the paper for two years. I thought I was le=
arning it but in fact I was just doing well because I was caught up in th=
e last two years of a raging bull market. I let the paper go when stock=
s were going no where but down. When the market turns I will probably tr=
y it again but in the mean time it is to big of an expense to pay for tra=
ining. Especially if we have a 10 year bear. Sorry if I ask simple ques=
tions right now, but the books and this web site are where I'm being taug=
ht right now. I want to thank everyone on this site for all the help and =
training you offer the rest of us. nancy
- ----- Original Message -----
From: Fred Richards
Sent: Thursday, December 05, 2002 9:35 PM
To: canslim@lists.xmission.com
Subject: RE: [CANSLIM] Fundamental Philosophies
Curt,
After some 40 years in this business, I believe that one of the guideline=
s my mentor pounded into my head is still applicable.
"You get what you pay for in this business."
Fred
- -----Original Message-----
From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmissi=
on.com]On Behalf Of Curt Corley
Sent: Thursday, December 05, 2002 9:22 PM
To: canslim@lists.xmission.com
Subject: RE: [CANSLIM] Fundamental Philosophies
Fred,
=20
I was just joking about the online service. Maybe I should have put a =E2=
=80=9C;)=E2=80=9D after that statement, instead of a =E2=80=9C:).=E2=80=9D=
=20
=20
I agree with the idea that the cost is not very significant if you are ab=
le to make significantly more than $500 using DGO and IBD =E2=80=93 espec=
ially if you are unable to make that amount without DGO. However, that c=
ould very well strengthen the argument in favor of lower cost, because (1=
) there are quite a few people out there who are not in your position and=
who don=E2=80=99t have the starting capital and/or skills to make a sign=
ificant amount over $500, and (2) there are quite a few people out there =
who can make significant money without the service. ;)
=20
Curt
=20
- -----Original Message-----
From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmissi=
on.com] On Behalf Of Fred Richards
Sent: Thursday, December 05, 2002 8:36 PM
To: canslim@lists.xmission.com
Subject: RE: [CANSLIM] Fundamental Philosophies
=20
And just how much will you charge? Have you given any consideration to t=
he costs involved? Or how many people might sign up for another stock ra=
ting service?
=20
It is always great to leverage off other people's work but unless you can=
make a profit after all the costs both known and unknown are caculated, =
don't make the number 1 mistake of most entrepreneurs . . . failing to c=
onsider the cost of one's time.
=20
Since I make a few more dollars than $500 using the DGO and IBD, the cost=
is only material to those who don't.
- -----Original Message-----
From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmissi=
on.com]On Behalf Of Curt Corley
Sent: Thursday, December 05, 2002 8:15 PM
To: canslim@lists.xmission.com
Subject: [CANSLIM] Fundamental Philosophies
Hi,
=20
I hope you don=E2=80=99t mind me changing the subject name of this thread=
to something a little more appropriate than NXTL and SXT. =20
=20
To answer your question: Yes, I would certainly consider purchasing a st=
ock if the ROE was less than 16.5% with all other factors looking good. =
As you know, I=E2=80=99ve purchased PECS and MNTR recently -- two stocks =
that were a lot less perfect than the theoretical stock you mentioned. I=
get your point, and you are right: an ROE below 17% certainly does not =
mean the company or the stock is bad. But here=E2=80=99s a situation to =
consider. Let=E2=80=99s say you have screened 9,100+ stocks, and came up=
with a dozen or so stocks that have what you consider to be near-perfect=
fundamentals. And let=E2=80=99s say a few of those look like they might=
break out of a base formation within the next couple of weeks. Would yo=
u rather wait around for the possibility that those stocks with the best =
fundamentals will break out? Or would rather purchase stocks that have a=
lready broken out but which have less stellar fundamentals? Within a ver=
y short time after purchasing PECS and MNTR, I saw other stocks with bett=
er fundamentals that looked like they were ready to make a move. Of cour=
se, that=E2=80=99s a tough thing to watch, and that=E2=80=99s why I put s=
ome thought into this question. Given my situation and my personality, I=
decided I would rather keep my eye on only the very best ones. That=E2=80=
=99s why I decided last weekend to screen only the near-perfect ones and =
keep an eye on those. And now you, Andy, and Tom are starting to make me=
doubt that decision. Thanks a lot! :)
=20
Seriously now: this has been a very educational and interesting thread. =
Hopefully, by the time we are through with this, we will have figured ou=
t the best overall stock-picking system; then we can start an on-line rat=
ing system and screening service that doesn=E2=80=99t cost $500 a year. =
:)
=20
Curt
=20
P.S. =E2=80=93 I would like to open a topic up some time in the future ab=
out the use of earnings estimates. But this topic is enough for now. My=
laptop is over-heating. I=E2=80=99m coming into work tired. And my wif=
e is starting to forget my middle name.
=20
- -----Original Message-----
From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmissi=
on.com] On Behalf Of kmalm
Sent: Thursday, December 05, 2002 11:44 AM
To: canslim@lists.xmission.com
Subject: RE: [CANSLIM] NXTL, SXT
=20
Hi Curt,
=20
I think you've identified the stickier issues in CANSLIM and interpreting=
WON's work. As both Tom and Andy have pointed out in their posts, while =
WON may *seem* to be stating that ROE>=3D17 is a "minimum requirement' it=
turns out it is a guidepost to lead you to better quality stocks. As wit=
h other indicators, this is based on his historical view of winning stock=
s, meaning that "on average" winning stocks had an ROE>=3D17. As with D/E=
, ROE can be misleading. For example, if a company rejiggers their capita=
l structure and increases their outstanding shares, this will have an imm=
ediate impact on the ROE measure. Another way of viewing it would simply =
be by asking a question. That is, if you were looking at a stock and it h=
ad a "perfect" cup with handle (ok, it's theoretical!); high RS Rank; an =
RS line making new highs; met all other earnings, sales and profit margin=
guidelines, and broke out on 150% of ADV, would you pass it up because i=
t had an ROE of 16.5%? If so, why? Does the "low" ROE mean that it is not=
a good company or a good stock?
=20
Katherine
=20
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<HTML><BODY BGCOLOR=3D"white" STYLE=3D"font:10pt verdana; border:none;bac=
kground-color:white; "><DIV>I would just like to put in my opinion if pos=
sible. For people who are just learning the IBD system and doing all the=
wrong things and not making money(especially in this market) it is a big=
expense-on top of no profits and maybe losing money. For people who hav=
e traded for 40 years and have their own web site and know Bill O'neil pe=
rsonally, I'm sure it is well worth the money. I think the problem =
is -how do you learn the system when you have no stock market=
background unless you pay that much money just to try to lear=
n. I had the paper for two years. I thought I was learning it but i=
n fact I was just doing well because I was caught up in the last two year=
s of a raging bull market. I let the paper go when stocks wer=
e going no where but down. When the market turns I will probably tr=
y it again but in the mean time it is to big of an expense to pay for tra=
ining. Especially if we have a 10 year bear. Sorry if I ask s=
imple questions right now, but the books and this web site are where I'm =
being taught right now. I want to thank everyone on this site for all the=
help and training you offer the rest of us. nancy</DIV> <DIV> =
;</DIV> <BLOCKQUOTE style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGI=
N-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px"> <DIV sty=
le=3D"FONT: 10pt Arial">----- Original Message -----</DIV> <DIV style=3D"=
BACKGROUND: #e4e4e4; FONT: 10pt Arial; COLOR: black"><B>From:</B> Fred Ri=
chards</DIV> <DIV style=3D"FONT: 10pt Arial"><B>Sent:</B> Thursday, Decem=
ber 05, 2002 9:35 PM</DIV> <DIV style=3D"FONT: 10pt Arial"><B>To:</B> can=
slim@lists.xmission.com</DIV> <DIV style=3D"FONT: 10pt Arial"><B>Subject:=
</B> RE: [CANSLIM] Fundamental Philosophies</DIV> <DIV> </DIV> <META=
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- -size: 10.0pt; mso-bidi-font-size: 10.0pt; mso-ascii-font-family: Arial; =
mso-hansi-font-family: Arial; mso-bidi-font-family: Arial } DIV.Section1 =
{ page: Section1 } </STYLE> <DIV><SPAN class=3D180333704-06122002><FONT=
face=3DArial color=3D#0000ff size=3D2>Curt,</FONT></SPAN></DIV> <DIV><SP=
AN class=3D180333704-06122002><FONT face=3DArial color=3D#0000ff size=3D2=
></FONT></SPAN> </DIV> <DIV><SPAN class=3D180333704-06122002><FONT f=
ace=3DArial color=3D#0000ff size=3D2>After some 40 years in this business=
, I believe that one of the guidelines my mentor pounded into my head is =
still applicable.</FONT></SPAN></DIV> <DIV><SPAN class=3D180333704-061220=
02><FONT face=3DArial color=3D#0000ff size=3D2></FONT></SPAN> </DIV>=
<DIV><SPAN class=3D180333704-06122002><FONT face=3DArial color=3D#0000ff=
size=3D2>"You get what you pay for in this business."</FONT></SPAN></DIV=
> <DIV><SPAN class=3D180333704-06122002><FONT face=3DArial color=3D#0000f=
f size=3D2></FONT></SPAN> </DIV> <DIV><SPAN class=3D180333704-061220=
02><FONT face=3DArial color=3D#0000ff size=3D2>Fred</FONT></SPAN></DIV> <=
BLOCKQUOTE dir=3Dltr style=3D"MARGIN-RIGHT: 0px"> <DIV class=3DOutlookMes=
sageHeader dir=3Dltr align=3Dleft><FONT face=3DTahoma size=3D2>-----Origi=
nal Message-----<BR><B>From:</B> owner-canslim@lists.xmission.com [mailto=
:owner-canslim@lists.xmission.com]<B>On Behalf Of </B>Curt Corley<BR><B>S=
ent:</B> Thursday, December 05, 2002 9:22 PM<BR><B>To:</B> canslim@lists.=
xmission.com<BR><B>Subject:</B> RE: [CANSLIM] Fundamental Philosophies<BR=
><BR></FONT></DIV> <DIV class=3DSection1> <P class=3DMsoNormal><FONT face=
=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: nav=
y; FONT-FAMILY: Arial">Fred,<o:p></o:p></SPAN></FONT></P> <P class=3DMsoN=
ormal><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: =
10pt; COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P=
> <P class=3DMsoNormal><FONT face=3DArial color=3Dnavy size=3D2><SPAN sty=
le=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">I was just joking=
about the online service.<SPAN style=3D"mso-spacerun: yes"> </SPAN=
>Maybe I should have put a =E2=80=9C;)=E2=80=9D after that statement, ins=
tead of a =E2=80=9C:).=E2=80=9D<SPAN style=3D"mso-spacerun: yes"> <=
/SPAN><o:p></o:p></SPAN></FONT></P> <P class=3DMsoNormal><FONT face=3DAri=
al color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FON=
T-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <P class=3DMsoNormal=
><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt;=
COLOR: navy; FONT-FAMILY: Arial">I agree with the idea that the cost is =
not very significant if you are able to make significantly more than $500=
using DGO and IBD =E2=80=93 especially if you are unable to make that am=
ount without DGO.<SPAN style=3D"mso-spacerun: yes"> </SPAN>However,=
that could very well strengthen the argument in favor of lower cost, bec=
ause (1) there are quite a few people out there who are not in your posit=
ion and who don=E2=80=99t have the starting capital and/or skills to make=
a significant amount over $500, and (2) there are quite a few people out=
there who can make significant money without the service.<SPAN style=3D"=
mso-spacerun: yes"> </SPAN>;)<o:p></o:p></SPAN></FONT></P> <P class=
=3DMsoNormal><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT=
- -SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></F=
ONT></P> <P class=3DMsoNormal><FONT face=3DArial color=3Dnavy size=3D2><S=
PAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">Curt<o:p><=
/o:p></SPAN></FONT></P> <P class=3DMsoNormal><FONT face=3DArial color=3Dn=
avy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Ar=
ial"><o:p> </o:p></SPAN></FONT></P> <P class=3DMsoNormal style=3D"MA=
RGIN-LEFT: 0.5in"><FONT face=3DTahoma size=3D2><SPAN style=3D"FONT-SIZE: =
10pt; FONT-FAMILY: Tahoma">-----Original Message-----<BR><B><SPAN style=3D=
"FONT-WEIGHT: bold">From:</SPAN></B> owner-canslim@lists.xmission.com [ma=
ilto:owner-canslim@lists.xmission.com] <B><SPAN style=3D"FONT-WEIGHT: bol=
d">On Behalf Of </SPAN></B>Fred Richards<BR><B><SPAN style=3D"FONT-WEIGHT=
: bold">Sent:</SPAN></B> </SPAN></FONT><?xml:namespace prefix =3D st1 ns =
=3D "urn:schemas-microsoft-com:office:smarttags" /><st1:date Year=3D"2002=
" Day=3D"5" Month=3D"12"><FONT face=3DTahoma size=3D2><SPAN style=3D"FONT=
- -SIZE: 10pt; FONT-FAMILY: Tahoma">Thursday, December 05, 2002</SPAN></FON=
T></st1:date><FONT face=3DTahoma size=3D2><SPAN style=3D"FONT-SIZE: 10pt;=
FONT-FAMILY: Tahoma"> </SPAN></FONT><st1:time Hour=3D"20" Minute=3D"36">=
<FONT face=3DTahoma size=3D2><SPAN style=3D"FONT-SIZE: 10pt; FONT-FAMILY:=
Tahoma">8:36 PM</SPAN></FONT></st1:time><FONT face=3DTahoma size=3D2><SP=
AN style=3D"FONT-SIZE: 10pt; FONT-FAMILY: Tahoma"><BR><B><SPAN style=3D"F=
ONT-WEIGHT: bold">To:</SPAN></B> canslim@lists.xmission.com<BR><B><SPAN s=
tyle=3D"FONT-WEIGHT: bold">Subject:</SPAN></B> RE: [CANSLIM] Fundamental =
Philosophies</SPAN></FONT></P> <P class=3DMsoNormal style=3D"MARGIN-LEFT:=
0.5in"><FONT face=3D"Times New Roman" size=3D3><SPAN style=3D"FONT-SIZE:=
12pt"><o:p> </o:p></SPAN></FONT></P> <DIV> <P class=3DMsoNormal sty=
le=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dblue size=3D2><SPAN =
style=3D"FONT-SIZE: 10pt; COLOR: blue; FONT-FAMILY: Arial">And just how m=
uch will you charge? Have you given any consideration to the costs =
involved? Or how many people might sign up for another stock rating=
service?</SPAN></FONT><o:p></o:p></P></DIV> <DIV> <P class=3DMsoNormal s=
tyle=3D"MARGIN-LEFT: 0.5in"><FONT face=3D"Times New Roman" size=3D3><SPAN=
style=3D"FONT-SIZE: 12pt"> <o:p></o:p></SPAN></FONT></P></DIV> <DIV=
> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial co=
lor=3Dblue size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: blue; FONT-FAM=
ILY: Arial">It is always great to leverage off other people's work but un=
less you can make a profit after all the costs both known and unknown are=
caculated, don't make the number 1 mistake of most entrepreneurs .=
. . failing to consider the cost of one's time.</SPAN></FONT><o:p></o:p>=
</P></DIV> <DIV> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT =
face=3D"Times New Roman" size=3D3><SPAN style=3D"FONT-SIZE: 12pt"> <=
o:p></o:p></SPAN></FONT></P></DIV> <DIV> <P class=3DMsoNormal style=3D"MA=
RGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dblue size=3D2><SPAN style=3D=
"FONT-SIZE: 10pt; COLOR: blue; FONT-FAMILY: Arial">Since I make a few mor=
e dollars than $500 using the DGO and IBD, the cost is only material to t=
hose who don't.</SPAN></FONT><o:p></o:p></P></DIV> <BLOCKQUOTE style=3D"M=
ARGIN-TOP: 5pt; MARGIN-BOTTOM: 5pt; MARGIN-RIGHT: 0in"> <P class=3DMsoNor=
mal style=3D"MARGIN-BOTTOM: 12pt; MARGIN-LEFT: 0.5in; MARGIN-RIGHT: 0in; =
mso-margin-top-alt: 0in"><FONT face=3DTahoma size=3D2><SPAN style=3D"FONT=
- -SIZE: 10pt; FONT-FAMILY: Tahoma">-----Original Message-----<BR><B><SPAN =
style=3D"FONT-WEIGHT: bold">From:</SPAN></B> owner-canslim@lists.xmission=
.com [mailto:owner-canslim@lists.xmission.com]<B><SPAN style=3D"FONT-WEIG=
HT: bold">On Behalf Of </SPAN></B>Curt Corley<BR><B><SPAN style=3D"FONT-W=
EIGHT: bold">Sent:</SPAN></B> Thursday, December 05, 2002 8:15 PM<BR><B><=
SPAN style=3D"FONT-WEIGHT: bold">To:</SPAN></B> canslim@lists.xmission.co=
m<BR><B><SPAN style=3D"FONT-WEIGHT: bold">Subject:</SPAN></B> [CANSLIM] F=
undamental Philosophies</SPAN></FONT><o:p></o:p></P> <P class=3DMsoNormal=
style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dnavy size=3D2><S=
PAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">Hi,<o:p></=
o:p></SPAN></FONT></P> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in">=
<FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; =
COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <P c=
lass=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3D=
navy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: A=
rial">I hope you don=E2=80=99t mind me changing the subject name of this =
thread to something a little more appropriate than NXTL and SXT. <o:p></o=
:p></SPAN></FONT></P> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><=
FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; C=
OLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <P cl=
ass=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dn=
avy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Ar=
ial">To answer your question:<SPAN style=3D"mso-spacerun: yes"> </S=
PAN>Yes, I would certainly consider purchasing a stock if the ROE was les=
s than 16.5% with all other factors looking good.<SPAN style=3D"mso-space=
run: yes"> </SPAN>As you know, I=E2=80=99ve purchased </SPAN></FONT=
><st1:City><st1:place><FONT face=3DArial color=3Dnavy size=3D2><SPAN styl=
e=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">PECS</SPAN></FONT>=
</st1:place></st1:City><FONT face=3DArial color=3Dnavy size=3D2><SPAN sty=
le=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial"> and MNTR recentl=
y -- two stocks that were a lot less perfect than the theoretical stock y=
ou mentioned.<SPAN style=3D"mso-spacerun: yes"> </SPAN>I get your p=
oint, and you are right:<SPAN style=3D"mso-spacerun: yes"> </SPAN>a=
n ROE below 17% certainly does not mean the company or the stock is bad.<=
SPAN style=3D"mso-spacerun: yes"> </SPAN>But here=E2=80=99s a situa=
tion to consider.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Let=E2=80=
=99s say you have screened 9,100+ stocks, and came up with a dozen or so =
stocks that have what you consider to be near-perfect fundamentals.<SPAN =
style=3D"mso-spacerun: yes"> </SPAN>And let=E2=80=99s say a few of =
those look like they might break out of a base formation within the next =
couple of weeks.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Would you=
rather wait around for the possibility that those stocks with the best f=
undamentals will break out?<SPAN style=3D"mso-spacerun: yes"> </SPA=
N>Or would rather purchase stocks that have already broken out but which =
have less stellar fundamentals?<SPAN style=3D"mso-spacerun: yes"> <=
/SPAN>Within a very short time after purchasing </SPAN></FONT><st1:City><=
st1:place><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SI=
ZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">PECS</SPAN></FONT></st1:place>=
</st1:City><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-S=
IZE: 10pt; COLOR: navy; FONT-FAMILY: Arial"> and MNTR, I saw other stocks=
with better fundamentals that looked like they were ready to make a move=
.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Of course, that=E2=80=99=
s a tough thing to watch, and that=E2=80=99s why I put some thought into =
this question.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Given my si=
tuation and my personality, I decided I would rather keep my eye on only =
the very best ones.<SPAN style=3D"mso-spacerun: yes"> </SPAN>That=E2=
=80=99s why I decided last weekend to screen only the near-perfect ones a=
nd keep an eye on those.<SPAN style=3D"mso-spacerun: yes"> </SPAN>A=
nd now you, Andy, and Tom are starting to make me doubt that decision.<SP=
AN style=3D"mso-spacerun: yes"> </SPAN>Thanks a lot!<SPAN style=3D"=
mso-spacerun: yes"> </SPAN>:)<o:p></o:p></SPAN></FONT></P> <P class=
=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dnavy=
size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial=
"><o:p> </o:p></SPAN></FONT></P> <P class=3DMsoNormal style=3D"MARGI=
N-LEFT: 0.5in"><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FO=
NT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">Seriously now:<SPAN style=
=3D"mso-spacerun: yes"> </SPAN>this has been a very educational and=
interesting thread.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Hopef=
ully, by the time we are through with this, we will have figured out the =
best overall stock-picking system; then we can start an on-line rating sy=
stem and screening service that doesn=E2=80=99t cost $500 a year.<SPAN st=
yle=3D"mso-spacerun: yes"> </SPAN>:)<o:p></o:p></SPAN></FONT></P> <=
P class=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=
=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY=
: Arial"><o:p> </o:p></SPAN></FONT></P> <P class=3DMsoNormal style=3D=
"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=
=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">Curt<o:p></o:p></SP=
AN></FONT></P> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 0.5in"><FONT fa=
ce=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: n=
avy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <P class=3DM=
soNormal style=3D"MARGIN-LEFT: 0.5in"><FONT face=3DArial color=3Dnavy siz=
e=3D2><SPAN style=3D"FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">P.=
S. =E2=80=93 I would like to open a topic up some time in the future abou=
t the use of earnings estimates.<SPAN style=3D"mso-spacerun: yes"> =
</SPAN>But this topic is enough for now.<SPAN style=3D"mso-spacerun: yes"=
> </SPAN>My laptop is over-heating.<SPAN style=3D"mso-spacerun: yes=
"> </SPAN>I=E2=80=99m coming into work tired.<SPAN style=3D"mso-spa=
cerun: yes"> </SPAN>And my wife is starting to forget my middle nam=
e.<o:p></o:p></SPAN></FONT></P> <P class=3DMsoNormal style=3D"MARGIN-LEFT=
: 0.5in"><FONT face=3DArial color=3Dnavy size=3D2><SPAN style=3D"FONT-SIZ=
E: 10pt; COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT>=
</P> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 1in"><FONT face=3DTahoma =
size=3D2><SPAN style=3D"FONT-SIZE: 10pt; FONT-FAMILY: Tahoma">-----Origin=
al Message-----<BR><B><SPAN style=3D"FONT-WEIGHT: bold">From:</SPAN></B> =
owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com=
] <B><SPAN style=3D"FONT-WEIGHT: bold">On Behalf Of </SPAN></B>kmalm<BR><=
B><SPAN style=3D"FONT-WEIGHT: bold">Sent:</SPAN></B> </SPAN></FONT><st1:d=
ate Year=3D"2002" Day=3D"5" Month=3D"12"><FONT face=3DTahoma size=3D2><SP=
AN style=3D"FONT-SIZE: 10pt; FONT-FAMILY: Tahoma">Thursday, December 05, =
2002</SPAN></FONT></st1:date><FONT face=3DTahoma size=3D2><SPAN style=3D"=
FONT-SIZE: 10pt; FONT-FAMILY: Tahoma"> </SPAN></FONT><st1:time Hour=3D"11=
" Minute=3D"44"><FONT face=3DTahoma size=3D2><SPAN style=3D"FONT-SIZE: 10=
pt; FONT-FAMILY: Tahoma">11:44 AM</SPAN></FONT></st1:time><FONT face=3DTa=
homa size=3D2><SPAN style=3D"FONT-SIZE: 10pt; FONT-FAMILY: Tahoma"><BR><B=
><SPAN style=3D"FONT-WEIGHT: bold">To:</SPAN></B> canslim@lists.xmission.=
com<BR><B><SPAN style=3D"FONT-WEIGHT: bold">Subject:</SPAN></B> RE: [CANS=
LIM] NXTL, SXT</SPAN></FONT><o:p></o:p></P> <P class=3DMsoNormal style=3D=
"MARGIN-LEFT: 1in"><FONT face=3D"Times New Roman" size=3D3><SPAN style=3D=
"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P> <DIV> <P class=3DMs=
oNormal style=3D"MARGIN-LEFT: 1in"><FONT face=3D"Times New Roman" size=3D=
3><SPAN style=3D"FONT-SIZE: 12pt">Hi Curt,<o:p></o:p></SPAN></FONT></P></=
DIV> <DIV> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 1in"><FONT face=3D"=
Times New Roman" size=3D3><SPAN style=3D"FONT-SIZE: 12pt"> <o:p></o:=
p></SPAN></FONT></P></DIV> <DIV> <P class=3DMsoNormal style=3D"MARGIN-LEF=
T: 1in"><FONT face=3D"Times New Roman" size=3D3><SPAN style=3D"FONT-SIZE:=
12pt">I think you've identified the stickier issues in CANSLIM and inter=
preting WON's work. As both Tom and Andy have pointed out in their posts,=
while WON may *seem* to be stating that ROE>=3D17 is a "minimum requi=
rement' it turns out it is a guidepost to lead you to better quality stoc=
ks. As with other indicators, this is based on his historical view of win=
ning stocks, meaning that "on average" winning stocks had an ROE>=3D17=
. As with D/E, ROE can be misleading. For example, if a company rejiggers=
their capital structure and increases their outstanding shares, this wil=
l have an immediate impact on the ROE measure. Another way of viewing it =
would simply be by asking a question. That is, if you were looking at a s=
tock and it had a "perfect" cup with handle (ok, it's theoretical!); high=
RS Rank; an RS line making new highs; met all other earnings, sales and =
profit margin guidelines, and broke out on 150% of ADV, would you pass it=
up because it had an ROE of 16.5%? If so, why? Does the "low" ROE mean t=
hat it is not a good company or a good stock?<o:p></o:p></SPAN></FONT></P=
></DIV> <DIV> <P class=3DMsoNormal style=3D"MARGIN-LEFT: 1in"><FONT face=3D=
"Times New Roman" size=3D3><SPAN style=3D"FONT-SIZE: 12pt"> <o:p></o=
:p></SPAN></FONT></P></DIV> <DIV> <P class=3DMsoNormal style=3D"MARGIN-LE=
FT: 1in"><FONT face=3D"Times New Roman" size=3D3><SPAN style=3D"FONT-SIZE=
: 12pt">Katherine<o:p></o:p></SPAN></FONT></P></DIV> <BLOCKQUOTE style=3D=
"MARGIN-TOP: 5pt; MARGIN-BOTTOM: 5pt; MARGIN-RIGHT: 0in"> <P class=3DMsoN=
ormal style=3D"MARGIN-BOTTOM: 12pt; MARGIN-LEFT: 0.5in; MARGIN-RIGHT: 0in=
; mso-margin-top-alt: 0in"><FONT face=3D"Times New Roman" size=3D3><SPAN =
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P></BLOCKQUOTE=
></BLOCKQUOTE></DIV></BLOCKQUOTE></BLOCKQUOTE></BODY></HTML>
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