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Technology Stocks : Intel Corporation (INTC)
INTC 35.53-1.1%Nov 14 9:30 AM EST
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To: Michael Bakunin who wrote (92808)11/18/1999 12:21:00 PM
From: Robert Douglas  Read Replies (2) of 186894
 
Say Intel grows revenues and earnings at 20% until its revenues represent 5% (!) of total GDP. Then Intel grows with GDP, at 5% nominal per year. Discount at 12.5%, and Intel is worth $200 B. -mb

Michael,

I don't mean to insult but that is the most nonsensical attempt at valuation I have ever seen.

For starters GDP is around $9 trillion. 5% of this would be $450 billion in revenues - an absurd number even for the most bullish INTC shareholder.

My estimates are $5 EPS in 5 years and a P/E multiple of 30 to 40. Discount to the present at 10% (a high discount rate, IMO) and you arrive at a present value between $93 and $124.
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