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Author: kallaloostx One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 27244  
Subject: Re: Valuing Companies Date: 11/6/2000 11:09 AM
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I just got into the stock market about a year ago after being in mutual funds for about 10 years. Here is how I chose my 10 stocks and the stock portfolio for each of my kids (which they will take over and manage when they turn 12...they are 4 and 5 now, but I digress. Basically, I have no desire whatsoever to be tied to analyzing every minute detail of my companies...so I came up with a list of about 25 Rule Maker companies (such as American Express, Dow Chemical, Applied Materials, Pfizer etc.) or companies that were of interest to me (eg.The Cheesecake Factory). I did get some annual reports and did some valuations based on the Fool School...just so that I understand HOW to read an annual report and what to look for in the future reports that I get. To choose the final ten stocks for my kids (like I said, after analyzing 4 or five), I went over to morningstar.com and read about each company and made my final decisions based on my gut and their valuations. This may be kind of lax, by others standards, but like I said, I am not buying penny stocks, I don't feel like having to grit my teeth every day over this news or that, and I plan to hold these companies (hopefully) for years. I also have aboslutely NO idea what companies like CISCO, Nortel, JDSUniphase and the like REALLY do (other than they are hot topics of converstaion now) so if I read their annual report, it would be GREEK to me...soooooo...on that note... I chose and split $5000 among:
1. The Cheese Cake Factory (CAKE)
2. American Express (AXP)
3. Dow Chemicals (DOW)
4. Pfizer (PFE)
5. Home Depot (HD)
6. Schering Plough (SGP)
7. Ebay
8. Nokia (NOK)
9. Teradyne (TER)
10. Applied Materials (AMAT)

Whatever way you choose to choose....CHOOSE! And good luck in your endeavors!

-Kall
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