2000 Date-Change Problem: Scam, Hype, Hoax, Fraud Message Board

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Technology Stocks : 2000 Date-Change Problem: Scam, Hype, Hoax, Fraud

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To: Sid Turtlman who wrote (197)	10/6/1997 3:41:00 PM
From: Jim Rathmann	of 1361

You have hit on the key reason why Y2K stock holders will lose money over the next few years: valuation. Based on analyst coverage, most of the Y2K companies are at best fully valued looking forward, and in some cases grossly overvalued. For example from First Call earnings growth rates are as follows for some of the Y2k players through FY98: CBSL 31%, PE based on FY98 earnings estimates: 33 IMRS 48%, PE based on FY98 earnings estimates: 46 KEA 31%, PE based on FY98 earnings estimates: 41 VIAS 21%, PE based on FY99 earnings estimates: 46 Obviously the hype and noteriety of the Y2K problem has driven these stocks to their full valuation and beyond. Y2K investors have to ask themselves if all these analysts are missing the boat as far as potential here? What will happen as the year 2000 approaches and the earnings growth is not sustained? I submit that if you are buying Y2K stocks at this juncture, you are buying the top of the market, because this play has already been made. The word is out to the general public on Y2K. When the momentum on these companies turns (which appears to be happening as we speak), it could get real ugly. jim

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