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Stocks G / Gulfstream Aerospace Corp.


Subject:  Re: great week for GAC Date:  4/17/1999  6:28 AM
Author:  wolfeman Number:  277 of 294

Since I asked the question several posts back, what is going on with GAC, and I didn't get any real answers, but GAC has decided to move up. I sent an email to GAC investor relations asking some questions, no answer back, but GAC has moved up. Several weeks back GAC was the only thing I had down. Now GAC is going up and all my other TECHs is going down. What a roller coaster?


It is impossible to know when and exactly why a stock moves as it does. I'm sure investor relations does not have the answers even if they could comment on stock price moves. GAC is an industrial and cannot move up as fast as a tech company. It will only pay in conjunction with it's growth. It will always have a pretty low PE since this type of business can only grow so fast. GAC is moving as fast as a manufacturer of large capital goods can go.

Further, each stock seems to have it's own caracteristic patterns. GAC sometimes moves in sympathy with BA or the transports even though it has little in common with those markets. It's just when investors think of airplanes, they remember GAC. Also, early in the quarter, the financial results are not as certain as they are later in the period. That is why many stocks languish after earnings and run up to the day the news is made public. A clearer picture and more certainty assures investors of a good quarter. GAC tends to behave in this manner. You can count the airplanes produced and get a good idea how successful the quarter will be.

During the last week, lots of money has rotated out of the techs and other leaders and flowed into more mundane companies with good earnings and valuations. There was a rush out of high PE stocks into prosperous value issues. GAC is one of those.

These are just guesses. A company that is doing a good job and improving their revenues and earnings will go up. It is hard to know when and what will trigger the action. As long as you have companies that are successful, they will go up in price. You may have to wait, but it will happen.

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