Let's hope SFP keeps on its upward track. It should get a real boost from its earning announcement next week--with one possible proviso--that the action of the Fed. Open Mkt. Committee won't throw everyone into some kind of mass panic. SFP has been getting some fine exposure, including its being recommended last Friday on the Nightly Business Report, then being mentioned favorably again on the NBR last night.
For humor's sake (or is it for the sake of weeping?), two hi-tech firms announced their supposedly fabulous quarterly earnings today. The first one earned a whopping 9 cents, which was a penny or two above analyst's estimates. That one's now selling at about $165/share. The other firm announced that it earned 6 cents for the quarter--a staggering 1 cent over analyst's estimates. This other stock is selling at about $125/share. I'm here to tell you that the PE multiples for both of these companies are between 450 and 525 per company.
Suppose, then, that SFP (which is likely growing faster than either of these companies) earns $5/share this year, and that its PE would fall half way between those of these two hi-tech outfits, i.e. a PE of 500. This would mean that SFP would be selling at a very cool $2500 per share. Not bad, not bad at all.
If any of you are inclined to find a moral in this story, please enlighten the rest of us. Condidates include: (1) Lotts 'a folks out there who are buying shares of such hi tech high flyers are nuts. (2) SFP is one heck of a value-plus-growth stock to own. (3) There are a bunch of bubbles out there waiting to be burst (4) So whoever said that the world is fair? Cheers and Tears, Harold V |
