A friend recommended that Dr. Stern buys Logitech. The reason is that companies are now cutting their travel budgets and instead utilizing video conferencing. This should cause their stocks to go up. Sounds logical. As always, he looks first at the Obermatt ranks.
Logitech has a Value Rank of 24.That is quite low. It means that only 24% of all companies are more expensive than Logitech. Or, in other words, 76% of all companies are cheaper than Logitech. That’s not a good reason to buy.
There is another company that might profit from video conferencing, namely, Microsoft, which bought Skype. While Microsoft’s Value Rank is better at 52, all other ranks are very bad. As a result, Dr. Stern won’t buy either Logitech nor Microsoft. Their stories sound nice, but the facts are not in their favor.
Why does he adamantly adhere to the Obermatt Ranks? The reason is that finance experts know that you should stick to the rules and the facts. Emotions will just end up costing you money in the end. This is why Dr. Stern wants a good Obermatt rank when he buys stocks. Neither Logitech nor Microsoft meet this requirement.