NOV) had a great earnings report and the stock was hammered. Given the state of the economy, anyone who issues an earnings forecast and uses it to value stocks is living in a dream world. It will be impossible to predict economic activity and earnings for several quarters. I want to buy assets on the cheap right now. Give me a pile of bricks, mortar, metal or, best of all, cash that I can buy at a discount-to-appraised value. Even if a building goes down another 25% from current levels, if I paid 70% of current value in the first place, I am probably OK. When a recovery does begin, there will be a scramble to buy cheap assets to fuel future growth and I want to be sitting here with a pile of them to sell.
Prep for the Market Turnaround Now Dig into the Details My asset stocks are not going to cause me to lose much sleep. Since I avoid debt-laden companies, my only concern is that they use assets improperly or sell them at ridiculous prices. Even in a bad economy, stocks like Adaptec ( ADPT) and Sycamore Networks ( SCMR) that sell for cash balances are worth more than the current stock price.