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Technology Stocks : Nokia (NOK)

NOK 6.775

-3.6%

3:59 PM EST

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To: Mephisto who wrote (2933)	12/6/1999 5:07:00 PM
From: tero kuittinen	Read Replies (3) of 34857

The accessory angle is great - it seems to work like a charm. A razor and blades business model where both are profitable. Fine. But what we're seeing is 50 billion dollars added to Nokia's market cap in a matter of weeks. Just a couple of weeks ago Nokia's target for the end of year 2000 was 120 dollars. Now we're talking 220 dollars in six months. Did something fundamental happen? Or are the investment banks now just chasing the market, instead of really looking at the business and basing their targets on that? I don't think that Nokia even touched their long-term projections in the Texas meeting. It's a great company, but what this market is doing is assuming that the long-term profit picture is suddenly a done deal. People can't keep adding the GDP of a Central American nation to the market cap of a leading company every month just because they're feeling perky. Jacking up the price earnings ratio to 100 doesn't make the company any more succesful. It just places an enormous burden on future earnings growth. The year 2000 quarters need to be not only good but flawlessly superb. I would be covering Amazon if I was into ulcers. Tero

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