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Peter Lynch

Warner Communications
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1977-1977
Industry: Media
Category: Strong Brand

Context
Warner Communications is the original company which owned
Warner Bros, Warner Records, DC Comics, and Mad Magazine.
Also owned Atari, which was spun out.
Warner Communications eventually merged with AT&T and Turner Broadcasting.
Eventually spawned HBO, Cinemax, MTV, Nickelodeon, The Movie Channel, VH1.

The Story
Lynch bought the shares in 1977 at $26/sh.
He got a call from a technical analyst who said that the stock was "extremely extended".
6 months or so later, the stock hit $38 (a 46% return).
Thinking that it was extended at $26, hyperextended at $32, it much be stretched into 3 prefixes at $38.
The stock continued to ascend to over $180/sh over the next 5 years (a 7-bagger).