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Non-Tech : Cable Car Beverage (DRNK)
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To: MKEL who wrote (88)5/21/1997 11:11:00 PM
From: Steve Patterson   of 284
 
Looks like DRNK is holding its high around 3 3/8. I'm hanging on to mine for a while.

Picking an exit point is always tough, but I'll say
.16 * 43 P/E = $6.88 in the short term, assuming fair value is 30x earnings for a company growing this fast. Since we were undervalued down to about 17x I choose a similar overvaluation to exit.

Or, taking fair valuation two years out as an alternative exit, my estimate of 25c for 1998 yields $.25 * 30 = $7.50. This means I will probably hang on until about $7, unless something bad happens. An over 250% ROI in two years would sure be nice...let's keep our fingers crossed (and buy more soda).

Still long,

Steve
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