SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : INSS - International Network Services

 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: joemjo who wrote (101)5/13/1997 8:52:00 PM
From: Glenn D. Rudolph   of 446
 
. Here is my new theory. Take the most recent quarterly earnings ($.06)
annualize it ($.24) and apply a 100 PE. With 100% being the growth rate.
Fair value at 24. So, three months from now they hit expectations of
$.07, X's 4 = $.28 price target 28. Next quarter $.09 = 36. Now we are
talking another 50% move in six months, not bad. I'm so confident I sell
out of the money puts, oh well.


Todd,

You are making an assumption that the growth rate will be 100% for more than one year. Your price target is based on a PE of 100 due to your assumption. Let's say that INSS gets lots of new contracts and orders but they cannot locate or train qualified consultants quickly enough. The companies needing service will turn to other consulting companies. They cannot wait until INSS gets around to them. Now we have a forced growth rate of less than 100% due to the lack of qualified personnel. CSCO is opening a research and development plant in Israel because they are having difficulty finding good engineers in this country. The good engineers all have jobs so CSCO takes the plant to where engineers are avaiable. INSS does not have that luxury.

Glenn
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext