I bought some more IBM on their little dip, in-the-money calls.I think it will do well in the next 4 years.They have forecast $20 EPS by 2015, and I think they'll manage it by 2016 to allow for a flubbed year.I think 13-14x isn't unreasonable, so a target of $280 isn't nuts and $260 seems eminently likely,so that's my target range around the time the January 2017 calls expire.I'm buying Jan 2015s and pencilling a few bucks more for the cost to roll to 2017 if needed.One thing about these price dips though: given the massive ongoing sharebuybacks, the more the price stays low for now the more likely it is they will hit the $20 EPS in 2015 as forecast. A given repurchase retires more shares, leaving fewer shares among which to divide the earnings.So I guess I want low prices for a good long while, then a zoom!Very contrarian.The lower the market's expectations for growth, the lower the price.The lower the price (for now), the higher the earnings growth will (later) due to cheap buybacks.So low expectations will lead directly to better results, and vice versa.Jim
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