Dear Walking,
Thanks for your eloquent presentation. As we all know the last 12 months have been sensational for tech stocks. Famous names that everybody knows about such as CSCO,EMC,QCOM,JDSU,SEBL, in addition to less well known ones such as Softbank,VRTS,NTAP,CTSH have all at least doubled,several tripled or much more so. So the biotech stocks that you own have participated to a fair extent. But a friend of mine has owned AMGEN for several years and he hasn't seen any gain exceeding that of the S&P 500. I looked up AMGN and found that the expected earnings for 1999 are 98 cents per share and ditto for 2000 is 1.09 per share. The brokers' consensus for the five year growth rate is 16.2% and those are usually optimistic. For a drug company, 16.2% is fine. For a tech stock it's not sensational at all. MLNM on the contrary has a predicted growth rate of 27%. But the estimated earnings for this year is zero and for next year is four cents a share. Isn't the stock getting ahead of itself? Anyway, you've convinced me that there's more life, aka profits, in this sector than I thought. I see princes but no gorillas. The truth is maybe half way between our positions. Good luck, anyway. I'm not shorting AMGN or MLNM. |
