Stock Ideas

[ May 9, 2000 ]

Duelling Fools -- Psion

As Duelling Fools returns, two of the Fool's most opinionated writers square off over the future of Psion (LSE: PON). Nigel Roberts (TMFNigel) takes the bears' side: how can the company's price be justified? Meanwhile Rob Davies (TMFEssex) thinks the company's EPOC operating system could dominate the wireless Internet.

Read on, and cast your votes using our Poll feature, below. Note that we've changed the voting method from Recommendations to Polls, since it was unfairly making our writers look popular on the boards...

The Bear Argument...

Well, it's quite scary to be taking the bear side of this argument: how can I possibly be bearish on Psion (LSE: PON)? They are a great company, for sure, and they have a great following on the discussion boards: but the trouble is, they also come with a great price. They have loads of potential for the future, but all of the potential has already been built into the current share price, and no account seems to have been taken of the risk of owning the shares. With Psion, the risk is as huge as the potential. more

The Bull Argument...

You might think that a value investor like TMF Essex would have no truck with a share trading on a price to sales ratio of 19 and a price to book ratio of 27.6. This company, Psion (LSE: PON), is capitalised at over £3,000m and recently joined the FTSE 100, yet in the last set of interim results reported a net profit of £3.3 million for 1999. Probably about the same as a half-decent supermarket from one of the major chains makes. more

• The Bear Argument
• The Bull Argument
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