Actually, we share a similar philosophy. However, I look for 20 times earnings 3 years out.
Although I fear, to some extent, the commoditization of flash as transpired with RAM a few years back, it seems that with the shortage of flash occurring at the commencement of the acceleration in demand for cell phones, PDA's, MP3 players, and internet "toasters" etc., commoditization may not occur for 5 years or more.
If pricing remains stable as demand soars, we should be able to grow 100% - 150% for the next few years. This assumes that SNDK does not win its battle with Lexar, which could propel SNDK into the ARMHY, RMBS, QCOM royalty racket.
So, my valuation, while hardly conservative, is based on definable growth occasioned by fundamental changes in the supply/demand equation.
Prophet |
