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Technology Stocks : All About Sun Microsystems
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To: Cengiz Erbas who wrote (10224)6/27/1998 1:06:00 PM
From: cfimx  Read Replies (2) of 64865
 
let's say msft earns $1.75 this f year. lets say they grow that at 20% rates for ten years, far lower than the growth they acheived the past ten years and highly likely given their emminent position in the industry. That mean this time in 2008, it should earn $10.84. Lets say investors aren't as silly then as they are now. Let's say they only feel msft is worth a 25 p/e. That means that msft will sell for $271. An investor buying today at $103 would get a 10.15% cagr on their money, even with a p/e of 60 on the current stock. And they wouldn't be taxed every year like they would with a 10% cd. Is that such a silly proposition with bonds yeilding < 6%, taxable?
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