Formerly About Advanced Micro Devices Message Board

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Politics : Formerly About Advanced Micro Devices

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To: Mani1 who wrote (105825)	4/15/2000 11:39:00 AM
From: f.simons	of 1576619

>>As I have already mentioned, AMD income from operation is still negative.<< Doesn't the issue of AMD's P/E depend on the method used to calculate it? You are using the trailing earnings method which yields negative earnings. A forward earnings approach would probably yield a positive number unless the person doing the calculation assumed that AMD would lose 1.15 +.43 = 1.58 or more in the next two quarters. The advantage of the trailing method is that you have real, actual numbers. The disadvantage is that a company that is on a real upswing doesn't get rewarded with a PE for a while, and then it is distorted for another while. The forward earnings method, though more difficult to calculate and calling for assumptions, is of more interest to investors in a case like AMD.

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