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I am trying to learn the ins and outs of shorting stocks. what if the co. is not overvalued--pe of 0, but they have bad news ,posted neg earnings past 2 or three reports and estimate for next quarter is a loss. Two companies Im looking at Sunbeam- SOC and MWI Meadow craft, Also maybe COOL. Am I on the right track or Should be looking at other things other than a slide? Thanks pennieannie
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Pennieannie,

You should read TMF Investment Guide for a brief overview of what to look for when shorting stocks. Previous posts on this board provide some good ideas about screening tools to come up with short ideas.

The P/E does not tell you if a stock is overvalued. A P/E of 0 just means that the company hasn't turned a profit yet but these are not necessarily good shorts. Most internet stocks fall into this catagory.

Often looking at past performance only may be misleading as the market has already adjusted for a company's poor performance in the future. Remember, the market is a forward look device.

I am not very familiar with the specific companies that you have mentioned except to advise caution when shorting an open-ended situation like COOL (or any other internet for that matter).

Luck to all

Ant
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