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Technology Stocks : Reliability Inc (REAL)
REAL 16.69+1.4%Jan 12 3:59 PM EST

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To: Bob Richmann who wrote (73)7/21/1997 11:24:00 AM
From: Christopher Brainard   of 542
 
Bob and All: I just did a quick and dirty estimate of earnings for REAL taking into effect the 1.3 million shares repurchased by the company. If the company only reports earnings equal to last year then 2nd quarter and full year EPS would be $0.43 and $1.63. The company stated in it's 1st 10-Q report that based on record backlogs going into the 2nd quarter, it estimated that full year sales and income would exceed 1996 levels. So lets get wild and crazy and estimate that earnings increase 15% in 1997 from the $4.846 million reported in 1996. EPS would then be $0.50 in the 2nd quarter and $1.87 for the full year. (estimates are currently $0.38 and $1.66) Let's also put a conservative PE ratio of 15 on those $1.87 earnings and we have a $28 stock. That's a number I really like!!!

Chris ....
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