“Just do Something”
Sometimes prices defy all reason.
Take the example of Cisco Systems, Inc. (CSCO).
On March 31, 1998, CSCO closed at $11.40. Over the next two years, CSCO increased in price 578.42% to close at $77.31 on March 31, 2000, which was the all-time high. It split 5 times and was one of the great darlings of Wall Street. Nobody could get enough of CSCO. On September 30, 2001, 18 months later, CSCO closed at $10.48 wiping out all the gain. I am quite sure there are investors who still own CSCO and rode it all the way up and all the way down.
The DynaLogic platform did not exist during the 1998-2000 timeframe, but it’s easy to surmise that there would have been a slew of Sell signals during the 2-year explosive rise to $77.31. In fact, it is probably accurate to state that the dollar amount of the Sells would have exceeded the original investment.
Fast forward to 7/13/2022 and CSCO is a much stronger company than it was in 2000 with a Price/Earnings of $14.87 and an indicated dividend yield of 3.56% but is trading at half the price at $42.70. It is currently followed by 32 analysts who are evenly split between Buy and Hold with one analyst publishing a Sell. Target price is $52.18. Estimated revenue for 2022 is $51.2 billion and Earnings per Share of $3.36. All healthy numbers that have been growing sequentially.
Emotions are difficult to overcome. It can be painful looking back and not having done anything. When you find yourself on a rocket ship, ask yourself if the price increases are sustainable. Perhaps you will pull the trigger and “Just do Something”. By the way, Grayscale Bitcoin Trust (GBTC) went from $10.97 on 9/30/2020 to $56.70 on 2/19/2021, a 416% increase in 142 days. The closing price on 7/13/2022 was $12.41.
“It’s not about winning; it’s about not losing.”
Subscribe to “Risk-off”. You will like the journey!
(Note: DynaLogic provides to subscribers relevant and real time market movement information on a host of equity securities. Signals (sell or buy) are based solely on mathematical changes in the price of a security. No other methodology is used.
DynaLogic is not a registered investment advisor, and it makes no representation or recommendation concerning the purchase or sale of any security investment product; DynaLogic provides no advice or recommendation whether a subscriber should or should not act on any signal a subscriber receives, and it has no knowledge whether a subscriber, in fact, acts on a signal or any signal; DynaLogic maintains no portfolio account or other investment information on any subscriber.)