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Technology Stocks : Network Appliance
NTAP 114.97-0.7%11:01 AM EST
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To: mtns_and_money who wrote (6959)3/13/2001 1:33:22 PM
From: pirate_200  Read Replies (3) of 10934
 
> "Prudential analyst Kimberly Alexy in a research report cut
> the 2001 earnings estimate to 38 cents a share from a previous
> estimate of 41 cents a share. She also lowered her 2002 earnings
> estimate for Network Appliance to 43 cents a share from 55 cents."

She is saying NTAP will earn .38 this year and .43 next year,
meaning she is saying earnings growth is going to be 13%.

But wait, there's more:

> "Alexy also lowered her price target for the stock to $42 a share
> from $71. The stock is rated a strong buy."

So, she says earnings growth will be 13%, yet she MAINTAINS
a strong buy and sets a $42 target?

If she thinks the growth rate will be 13%, 13 x .43 = $5.59.
Even if it's twice her 13% growth rate, that's only $11
a share, so where does $42 come from? Why maintain a
strong buy? Is Kimberly math-challenged?

Maybe the logic is that these analysts missed their targets
so severely on the high-end, they are now giving ridiculous
low-end targets to compensate?

I don't get it.
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