Exodus Communications, Inc. (EXDS) Message Board

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Technology Stocks : Exodus Communications, Inc. (EXDS)

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To: Robert Rose who wrote (921)	7/22/1999 4:36:00 PM
From: Doug Meetmer	Read Replies (2) of 3664

The interesting thing is that the Robby Stephens analyst is basing his 12 month price target on a year 2000 prive:revenue multiple of 25. In the old days, analysts used to use price earnings multiples, not price revenue multiples. Think about how outlandish it sounds to be setting a price target based upon a price:revenue multiple of 25! Everything is relative-I guess the multiple is justified if it is so for all of the other net stocks such as Yahoo, Ebay, Amazon. What we don't want to happen is to have the entire group settle down to another paradigm involving lower price:revenue multiples or, egads, price earnings ratios. This goes back to my statement the other day (for which I was rudely flamed) that a market cap of more than 5 billion (current) already seems very rich for a company with projected year 2000 revenue projection of 400 million. For the Robby Stephens Analyst to put a price target of $275 on EXDS essentially means that the market cap will be over $10 billion. Is it really justified? It is all relative.

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