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One other thing! nortel analysts

[lamystique]

last summer when nortel was trading for $120 per share I told my friend that had over $500.000.00 in nortel share to sell. He inherited them after BCE spun off this money loser to its share holders as a tax exemption strategy. He said that he did not want to pay the capital gains tax. Last week he spoke to me, and I reminded him about my suggestion to have sold the shares. He laughed about it, and I told him that they would go back up when Nortel would start reporting profits again. But you know what caused this in the first place was the analysts. Look at all the buy recommendations from all the investor experts on Nortel: as the year progress the price targets grew in leaps and bounds until the bubble in buyer interest started to dry up. The analysts were more bullish on Nortel at the highest market valuations than there are now when the market price is down to less than $25 per share. If I was asked who to trust in the investment professional world, I would trust none of them. When the companies like AMD and CY which recently had P/E ratios that were one quarter what they are historically, the analysts start to downgrade them. When the P/E ratios are on the increase then they upgrade their recommendations from hold to strong buy. At the peak of the momentum, they are recommending to investors the nominative 'strong aggressive' buy. They appear to on average rate the stocks based on momentum upwards rather than on the fundamentals of the company. Once apon a time there was a semicondutor company that was concerned about it share valuations. So it began to buy it's own stocks back. It did this when the analysts had consensually rated as a 'hold' (nominal sell order to it's clients). The semi firm purchased about $50-100 million in shares when they were in the $3-4 range. Then the company experienced strong historically high demand for its RAM memory, etc., and as the momentum picked up to buy the shares through analysts 'alerts' the stocks went up to $27 per share (US). The company sold the shares (and they stated they would sell the shares for the purposes of financing a new foundary), they took the capital gains and built a new foundary. The company's shares recently went to a high of $60 plus, and so if you are confident about the company it is better to trust the company and its' record, especially if historical they have committed to a business plan and exceeded their own financial and market goals. Today that same semi company is trading at $17 per share and the analysts are downgrading but not all. Last summer they were all upgrading the company. The company has a current P/E ratio of 7.5....analysts are a bunch of over paid copycats....for the most part. There are only a few good companies that have that potential and CSI wireless is one of them.