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Subject: Re: What's the message you're sending? Date: 5/5/2003 12:51 PM
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Hi xFatott,

I am glad TMFbogey answered your question. But I got to say, I sorta liked the other guys answer too.

For instance, I owned Home Depot for over 10 years and if I sold I would have to pay capital gains on it. Worse, its down a lot. And I wrote a report on it when it was under 25 and then again when it was 21 suggested it be added to the ab port as a long-term benchmark. It up 30% since then. Now that Home Depot is higher, I think Lowes could be a better buy based on value and momentum than Home Depot. But I would not sell my core position based on the difference. It is not worth it. I think Home Depot is worth more than $29 dollars and that value will be realized eventually. If I wrote a report today on them I would have to say Lowes might be better investment - for new investors - based on momentum and value but I still would hold my Home Depot position for two reasons.

1. the difference in the two going forward is not going to allow me to sell Home Depot, lose a portion to capital gains and reinvest the different in Lowes and come out ahead five years from now in my opinion.

2. Home Depot is larger and they can turn things around and probably will once again be trouncing Lowes. But that is speculative. And if you are writing facts it is difficult to say that Home Depot is executing better than Lowes presently because they are not. But they might be 6 months from now.

But Lowes is smoking and I recently bought an air conditioner there because they install and Home Depot does not. Yet I own Home Depot. I believe if Home Depot does not add more services they are going to be worth more than $29, but they are going to be losing ground to Lowes for a long time. So if I wrote a report today, I will say both will be going up and Lowes should do better unless Home Depot offers more services. But I will stick with my Home Depot position. I do not wish to sell and rebuy another company in the same industry based on the difference though the difference may favor Lowes. But if I were writing today about which is the best investment, I would have to say Lowes might have the advantage.

I certainly can see many reasons one would not sell Nike because of seeing better short to mid-term execution from Reebok. Large companies tend to change direction fast when they need to stifle a smaller well run company. Nike is seven times larger than Reebok and I would assume more clout because of its size. So, I can see how one can own a company and write about a different one that is executing better in the short-term. And decide not to sell the one they own.

But of course that is just my opinion

tom
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