Thanks for that article! Read it and weep American Spirit -->
Merrill, for instance, sees Applied Micro earning all of 7 cents in fiscal
2002 ended March and then 20 cents in fiscal 2003. Both of those are
down from the 48 cents the company earned in fiscal 2001. And based on
a recent stock price of $23, the stock is trading at 304 times 2002
earnings and 87 times 2003 earnings. "At these levels, we think it makes
sense to reiterate our intermediate term Neutral rating on the stock,"
analyst Mark Lipacis wrote in a research note. (Merrill hasn't done
underwriting for Applied Micro.)
Like one-time high-flyer Applied Micro, Broadcom and PMC-Sierra also
appear expensive.
According to Thomson Financial/First Call, Broadcom is expected to
break even this year and earn 42 cents in 2002, down from $1.04 in 2000.
At a recent stock price of $35.31, that means that it's trading at 84 times
2002 earnings. PMC-Sierra, meanwhile, is expected to earn 11 cents this
year and 57 cents in the following year, down from the $1.05 it earned this
year. At $37.38, its price-to-earnings ratio for this year is 340 and is 66
for 2002. |
