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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Seeker of Truth who wrote (48725)11/9/2001 11:11:04 AM
From: Jurgis Bekepuris  Read Replies (1) of 54805
 
Malcolm,

I won't comment on SEBL since it is not very easy
to value using my Buffetology approach.
I will comment on INTC.

OK, here is applied valuation from my point of view.
Conservative INTC ROE based on the last 10 years of ROEs and
on last year's FCF'OE is ~22%. Current equity is ~$37B,
market cap $186B. Assuming 10 years of the same ROE +
terminal PE 15 and adjusting for tax, the expected
return is ~12% annual. Not high, but certainly not
in the sell range.

The big question is whether we can assume 22% ROE for
next ten years. E.g. this assumes $670B market cap in
ten years.

Jurgis - Comments, flames, suggestions?
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