Tuesday, September 25, 2012

The Temptations of Brains (Hewlett-Packard)

Hewlett-Packard has taken a beating lately and rightfully so.  It has had a string of leadership issues and a ton of layoffs.  See the link below for a complete condemnation of the company:



It still has some very good brains left and it seems to recognize that, if it's to survive, the company must focus on R&D.  See below:


And...HP has brains across a range of scientific and engineering disciplines.  And who knows what patents already in the company's trove will prove relevant and valuable?  So, I have to repeat the conclusion I reached in my tech dogs post:  HP might be worth a long term investment at its current price.  Risky but not that risky -- what are the chances the company will be out of business before it experiences a significant rise in stock price?  Fairly low, I would say. 

All HP has to do is have one or two big successes, led by their brains, to rise again.  They are also in volatile businesses in which the company that was dead last 5 years ago can be No. 1 today.   

Monday, September 24, 2012

Corning (GLW): I'll be Watching

There is an interesting article on Corning and its focus on R&D in today's Wired magazine online.  The link follows.  The last time I recall Wired doing a piece like this was on MolyCorp (MCP), miner of rare earth metals.  The MolyCorp article portrayed the company ready to skyrocket because of the scarcity of rare earth metals in the West (as opposed to China) and MCP's purported lock on rare earth metals mining.  MCP did skyrocket -- for about a day.  It then proceeded to lose about half its value in a stunningly short period of time.  Today's Corning article makes a compelling case for the company as the type of R&D focused enterprise worth investing in.  We shall see how the stock performs in the aftermath of this article...


Wednesday, September 12, 2012

The Dangers of Generalizing

This is not strictly a post on investments but more on habits of mind.  An interview with a White, Southern woman who voted twice for George W. Bush and believes that President Obama is Muslim is a cautionary example of drawing conclusions from too little data or, more precisely, stereotyping.  Based on my description, one might expect that the woman in question is voting for Mitt Romney.  Wrong.  She is voting for Obama, despite her views on the President's religion.  Why?  Because she makes $28,000 a year and doesn't like Romney because, in her mind, he was born rich.  The interview with her is here:


The lesson obviously applies in a wider context.  Moreover, it confirms my personal belief that Americans are a more complex group than our leaders (and possibly the rest of the world) believe.  The access to internet and media available to all levels of American society will only magnify this effect going forward.  Indeed, the Republicans are running into some difficulty now in trying to appeal to disparate groups in American society.