Welcome to SI!
I am your welcoming committee. <g> Here is a model I posted to
the AOL thread a few minutes ago. I've plugged in some numbers
and ran it for Yahoo.
If you or anyone else wants to give me some assumptions for revenue
growth rate, Net Profit Margin, P/E, and diluted share growth, I'll
run the numbers and post it. Also, let me know what kind of return
you want on your money, so I can calculate a buy price.
Here is a 3 year model for Yahoo with what I believe are VERY
aggressive assumptions.
Each column represents a full year (eg."1999" represents a full year
of financial results ending June 1999).
Growth rate assumption for Revenue: 100% per year
Net Profit Margins: 30%
P/E used for model: 150
Diluted Share Growth: 15% per year
$ and share amounts in millions
1999 2000 2001 2002
------ ------ ------ ------
Revenue $331 $662 $1,324 $2,648
Net Income $95 $199 $397 $794
Net Profit Margin 29% 30% 30% 30%
Fully diluted shares 264 304 349 402
Market Cap
(Net Income X 150 P/E) $29,850 $59,550 $119,100
Stock Price $98.19 $170.63 $296.27
Discount the $296.27 stock price in year 2002 back at a 25% return
You'd be willing to pay
$151.69 for Yahoo now if you believe the results in the model
presented above will occur, and are willing to hold Yahoo for 3
years, and you are satisfied with a 25% return on your money per year. |
