Potash Corp./Saskatchewan (USA) (POT)

mpapile (33.75) Submitted: 10/2/2008 4:54:44 PM : Start Price: $199.79 POT Score: +16.80

The bigger the bubble, the harder the fall. People keep pointing to the 52 week range, but you forget that the valuation was based on potash and other fertilizer products that tripled in a short period of time. Now these products are back to normal levels, but I would say the fall here is not complete. As always, the market sees a probably valid macro trend that fertilizer use will increase over the years due to globalization and population growth, yet blows it entirely out of proportion. As the buzzword hype investors slowly fall off, you will see that this will be down 10x PE or so where it is a good LONG TERM stock. Just as amazon is not even at the levels it was in 1999 although it far surpassed anyone's wildest dreams, this stock will not attain $200 a share for a long time to come although everyone is probably right thinking this is a good future investment.

Also, lets not base the valuation here on 12 month forecasts made a few months ago because the product they sell is less than half the price it was a few months ago as in any bubble based on future demand.