I do not tend to agree with that sentiment. It is important to...

I do not tend to agree with that sentiment.

It is important to identify the source of the intangibles and assess the current value. For example, companies often pay far too much for a business either in cash or shares (dilution). IMS paid too much for Clipp so they pretty much ripped up $4m dollars of shareholder money that may have been better applied to their new venture.

Check the source of software intangibles. Is that created from a team working in the back office writing and rewriting software that may or may not generate revenue? May as well have expensed the wages in the first place.

Also be wary of what an IPO goes to market with. If they have not made a profit in the years prior to listing, why should they suddenly start once they have a few million in their bank account? This however does not apply to R&D stocks but do monitor their progress very, very carefully.

Works for me.