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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Pirah Naman who wrote (43539)6/15/2001 6:12:21 PM
From: Mike Buckley  Read Replies (1) of 54805
 
Pirah,

I own Siebel. I have a right to be optimistic. :)

You commented about the likelihood of a PSR of 15 if the revenues are growing 25% annually with its best years behind it. I can't begin to figure out how the market justifies the prices it does, so that's irrelevant. I keep hoping we return to the days when the PSR equals the growth in revenue. :)

Just for fun, I looked up some data supplied by MSN. (I don't vouch for its accuracy or its context.) Microsoft's revenue grew 19% annually from 1997 - 2000. It's average PSR during that time was 18. But its net margin (taken completely out of context) averaged 35% during that period, which is about three times as high as Siebel's net margin.

Cisco's average PSR from 1998 through 2000 was also 18. It's revenue grew 50% per year during that period. It's average net margin was 16%.

Aren't numbers fun? :)

--Mike Buckley
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