In our article of July 1, we noted that "all you can do is make your best judgement based on the facts and your experience, and then pull the trigger. Decisiveness is a virtue, but the hesitation waltz will lead you to the poorhouse." Today we talk about that. I think it's a great case study, because I made a lot of money by following my own advice.

On July 9, I told you that I had my eye on SanDisk. I phoned them and learned that they would be reporting their second quarter earnings on July 14, after the close. I had owned the stock before, buying at the high of 37, whereupon it proceeded to go down to 5 1/8. At 14 I bought four times as much as at 37, and in around two weeks it was 27. I took a nice profit, watched it ease off several points, and then it took off into the high 40's.

The first lesson here is don't get caught up in "shoulda coulda woulda." That's meaningless history. What counts is what do we do now. I knew that they were the world's largest supplier of flash data storage products, used in digital cameras, MP3 Internet music players, handheld computers, audio recorders, and smart phones. Use of these products is expanding greatly.

Anyway, I knew I had to make my move on the 14th. I felt that the reward for being right was double the penalty for being wrong. Those are pretty good odds, so I set aside a large amount of capital, and prepared to make my move.

SanDisk closed Tuesday at 49 7/8 - 1/8. It opened Wednesday at 50 1/4, went to 49 3/4, and then began to creep up. I trade on-line, and was getting close to continuous real-time quotes. At 6:48 a.m. Pacific Standard Time it was at 50 1/8, on only 8,400 shares. The quote remained at 50 1/8 @ 50 1/4 until 7:11 a.m., when it went to 50 3/16 @ 50 1/4. It stayed there until 7:28 a.m., when it became 50 1/4 @ 50 3/8. At 7:31 a.m. it rose to 50 1/4 @ 50 7/16. When it went to 50 3/8 @ 50 7/16 at 7:34 a.m., I had seen enough and was ready to pull the trigger.

As I was entering a large order at the ask price of 50 7/16, it occurred to me that in being too fine in trying to save 6 1/4 cents or so, this baby could get away from me. I changed the order to a market order, and I liked the idea of buying at the market and putting myself in front of most buyers. I bought immediately, buying one-half at 50 7/16 and the other half at 50-1/2. By 7:55 a.m. it was trading at 51, and by 8:34 a.m. it was trading at 52.

The stock closed Wednesday at 54 3/8 + 4. But the best was yet to come. Shortly after the close, they held a great Conference Call, and I listened in. The bottom line was that revenues and earnings were great, exceeding analysts' consensus estimates. They are expanding production, and even with that, there will be shortages over the next several years. Their current annual sales rate of $200 million should grow to $1 billion over the next 2-3 years. With this powder-keg news, the stock opened today at 57 3/8 + 3. It then proceeded to roar up, closing at 69 + 14 5/8!!! Now that's what I call a fair profit.

Seriously, the point is clear. Aside from being lucky as hell, you must do your homework on what you want to buy and when. And after you have decided, PULL THE TRIGGER. And don't look back, right or wrong. If there is anyplace in this world where decisiveness is crucial, it's the stock market. Stay tuned.

The Market Pro - July 15, 1999