marc said:
RVDondaPC said:
marc said:
#1 - Bitter? I was crushed because I loved games and I thought Sony would be my dream job. They were just bullies playing favorites and if you showed even a little talent they became hostile. The environment showed me the bad side to corporate behavior. I was just out of college at the time.
#2 - I took dividends into account for all my calculation. Even with the dividends, their business has performed poorly since '78. The Nasdaq index also pumps out dividends it just doesnt show up on most graph because its an index.
#3 - I was measuring Sony as a company not video games specifically. This thread was about the possibility of Sony going under. The author did not specify what part of Sony. I am fairly certain that he meant Sony as in the corporation not just the game division.
From a financial perspective they are a failure. Whevenever you can invest in 6% CD's and outperform a stock over 20 years, that company has serious issues.
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You mean to tell me you sat there and calculated today's value for all 50+ dividend payments from Sony stock? And how did you calculate today's value? Did you use just inflations, did you use the Dow Jones average increase assuming investment in another stock, did you assume reinvestment into more Sony stock, or did you assume happiness was purchased with these dividends?
@#3 yeah it was and that was fine until you started to compare Sony as a whole to MSFT and Nintendo as a whole to determine whether or not it's been under performing in its "sector. " Financially it can't compete, but Sony is in a lot of highly competitive, low margin industries while MSFT is mostly in an extremely rare high margin market, which was borderline monopolistic.
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Yea its just addition and I did it all in my head (big wow). I even took into account splits. Not exactly rocket science.
+/- $0.15 cents immediate volitility isnt going to make a huge difference in Sony's long term numbers.
Reinvestment is meaningless in our calculation because I didnt assume reinvestment for any of the other stocks (except for the 6% CD because they are guaranteed). Regardless, because Sony has underperformed the index, if you had reinvested back into Sony, you would have actually made your performance even worse because the gap would have grown wider over time.
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That's where you went wrong. What do you think MS and Nintendo are doing with all that cash they are holding on to? They are investing it. That's the whole point of not paying out dividends. It's so the company can invest that money on their own. If they pay a dividend it's because they feel that the stock holders would be better off investing that money on their own rather than the company doing it as a whole. You didn't assume reinvestment with the other companies because the reinvestment of profits is assumed by the stock price increase.
Also just because Sony under performed the market average(under the assumption your calculations are correct, which they are not) doesn't mean you lost money. And It also doesn't mean that reinvesting dividends in the company would make you lose even more money. It just means you didn't make as much money as the average stock did. You are getting under performing the market and "losing money" mixed up. They are completely two different things. If the market saw a 500% increase over 20 years and Sony saw a 400% increase that is under performing the market but still making a return. If those dividends were invested and reinvested over the course of those 20 years they would be worth way more than the simple addition that you claim it to be.
I think you are trying too hard to make Sony look bad for their failures that you are ignoring things that you otherwise wouldn't when analyzing a company's performance.
