How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 483.65

-0.8%

Dec 31 3:59 PM EST

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To: kvkkc1 who wrote (62019)	10/23/2001 2:39:55 PM
From: David Howe	Read Replies (2) of 74651

I feel MSFT will have EPS growth rates of around 10% for the next 5 years. I studied the Dow 30 and found that the average PE was around 22 even though almost none of these companies had any appreciable growth, let alone 10%. I also studied the Dow 30 and found that none of these companies had a balance sheet anywhere comparable to MSFT. Take out the value of MSFT's cash and you have a forward PE of around 25. It's fairly valued in my opinion, even from a long term historical PE metric. Can't compare PS of different companies. MSFT margins are far greater than nearly any company.

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