Forum Archive Index - May 2000

[Chris <cd@ak.planet.gen.nz>]

Ben,
 
As I recall TMN listed on the ASX in late Oct '99 at about $1.90.  It 
quickly gained support and passed through $4 by year end.  It did  hit 
$10 briefly as you suggest but traded at over $8 on just 5 days.  Volume 
then averaged about 350,000.  That's solid for TMN.  Recent trading, 
yesterday and today, has been extremely light at 50,000 in the $3.50-70 
range. Currently $3.50 and support at $3.40.    

I would not be surprised if we were not near the bottom but like others 
am weary of the overall market.  $3.20-30 and I will accumulate for sure.

Great to see discussion of TMN and your impression of Chris Jones.  I 
have heard similar sentiment from others who have met him.

Regards,

Chris

cd@pl.net



>Hi Neil,
>
>Yup - I agree with what you say - of course one has to determine if a share
>is appropriately priced before making the buy decision.  But what's an
>"appropriate" price?
>
>Looking at Telemedia, it's currently trading at $3.70.  That's down from its
>all time high of $10 on March 30 - and nearing it's one year low of $3.50.
>So is TMN appropriately priced?  Is it cheap?  Is it expensive?
>Unfortunately one cannot apply Buffetology to technology stocks (As the Sage
>of Omaha freely admits himself).  Mr Buffett certainly would never touch
>TMN - it has a P/E ratio of 284.62.  But others have, betting on the fact
>that it will be a winning company in the future.  They've even driven the
>share price up to $10.
>
>Thus, by investing in TMN at its current price, one is betting that the
>company will continue to grow and prosper at a rapid pace.  I freely admit
>that this is a bet - but Chris Jones convinced me that he was the man for
>the job.
>
>Of course, there may be problems that I'm unaware of - Lincoln Watson made
>some good comments yesterday about the possibility of TMN not being able to
>deliver at its current growth rate.  This may be true, I don't know.
>
>For better or for worse (and we could discuss this for weeks :) tech stocks
>in today's market do not follow traditional valuation techniques.
>
>Best Regards,
>
>Benjamin Dutton

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