It will gap up $10 at open!
Well, I would be great to take that offer. From the fundamental
viewpoint, $37 is not that high if using future PE ratio as the
guideline. It's illustrated as follows:
Currently, Street's estimate for '98 net is $1.08 with $0.15 in Q2.
Since Q2's net has been far exceeding the expectation, hence I would
logically assume nets in Q3 and Q4 will be proporationally increased.
The sum of Q3 and Q4 from analysts' estimate is $0.60. After the
surprisingly positive number in Q2, hence, I assume the sum of Q3 and
Q4 will be at least $1.0. Therefore, the total net in '98 will be
$1.71. If we use PE 25 as the calculated base (in reality, PE could
be as high as 50+, such as Dell, Gateway, etc.), the reasonable
price should be around $42.75. If using PE as 20, it will be $34+.
Therefore, your $37+ for a gap jump wouldn't be surprising to me.
Phil |
