41–50 of 86 posts
IBM has made some very good decisions, in particular realizing that huge amount of money that can be made in expert solve any problem services and sought to make infrastructure a cheap commodity so companies could spend more on services (i.e., investment in open source). So smart, and something I would never have been able to figure out without hind site.
>hind site hindsight
FWIW, IBM is more expensive on a PE basis, trading at trailing PE of 14 compared to Microsoft's PE of 9.8.
Hint: Watching CNBC doesn't make you a good investor, and throwing around the letters "PE" just makes you look like the worst kind of shallow, ignorant investor. No experienced investor bases stock purchasing decisions off P/E ratio alone or even primarily, because the metric has absolutely no intrinsic meaning.
Earlier quoted context omitted.
IBM's business model is approximately "We will solve your problems for piles and piles of money. Usually not problems that require technical breakthroughs or research level computer science knowledge, but ill-defined problems that involve many stakeholders, much politics, and complex business logic." They make their money as a professional services company (a model Buffett has no trouble understanding) that uses tech…
That is IBM Global Services, which is basically the same as Accenture, Cap Gemini, Wipro etc, IT outsourcing/offshoring. It's about half of IBM, by revenue.
FWIW, IBM is more expensive on a PE basis, trading at trailing PE of 14 compared to Microsoft's PE of 9.8.
Hint: Watching CNBC doesn't make you a good investor, and throwing around the letters "PE" just makes you look like the worst kind of shallow, ignorant investor. No experienced investor bases stock purchasing decisions off P/E ratio alone or even primarily, because the metric has absolutely no intrinsic meaning.
Earlier quoted context omitted.
Even so IBM's business model when they are not selling wetware involves selling expensive black boxes that are maintained, installed, and serviced by expensive wetware. Even though it makes up half of revenue, that doesn't mean the other half is not directly related to driving business to the wetware side. I think the business model outlined above is correct in the global strategy sense, even if you looking at a few…
IBM GS is tech-agnostic; they don't just implement IBM mainframe solutions, they'll take your money to do SAP, Oracle, whatever you want, same as any of the other bodyshops.
If they are tech-agnostic then they aren't in the hardware/software business, which was my original point. They are in the hardware/software business because it helps them take your money for the wetware side.
Invest in companies that are actually producing something valuable. That's the way to restart the economy. Can we all move on from the social media bubble and get back to real work now ?
Perhaps it would be helpful for all, if you could specify what in your opinion is "real Work"? We're all here to share views and we could learn something from what is at the back of your mind.
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Perhaps it would be helpful for all, if you could specify what in your opinion is "real Work"? We're all here to share views and we could learn something from what is at the back of your mind.
Shipping real things for real money to real customers who themselves have real customers who are paying them money?
Earlier quoted context omitted.
Hint: Watching CNBC doesn't make you a good investor, and throwing around the letters "PE" just makes you look like the worst kind of shallow, ignorant investor. No experienced investor bases stock purchasing decisions off P/E ratio alone or even primarily, because the metric has absolutely no intrinsic meaning.
P/E is pretty important, or could you back up why it is not?
Price is based on a combination of assets (not all of which have fixed values), future outlook (which can change at any moment and is based on subjective judgements and irrational consumer spending decisions), scarcity of the stock, and even second-to-second manipulations by automatic trading platforms.
You are dividing an absolute quantity based on past performance by a complicated, ever-changing number based in no small part on future predictions and other subjective and human factors, and trying to extract some sort of meaning.
Without a framework in which to evaluate the result that incorporates many, many other factors that are far more interesting, all you've got is a number that assumes the current judgement of the market has some relationship to past performance.
Earlier quoted context omitted.
Hint: Watching CNBC doesn't make you a good investor, and throwing around the letters "PE" just makes you look like the worst kind of shallow, ignorant investor. No experienced investor bases stock purchasing decisions off P/E ratio alone or even primarily, because the metric has absolutely no intrinsic meaning.
Please, read the HN guidelines, especially the parts about being civil and replying to arguments instead of calling names.