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Technology Stocks : Wind River going up, up, up!
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To: Srivaths Srinivasan who wrote (2236)10/10/1997 12:46:00 PM
From: Allen Benn   of 10309
 
>With all the good news about I2O, Intel why hasn't it translated to an increase in the share price?

Actually, as good as the I2O news is, there has been lot's of equally good news over the last few months, such as the DSP directive, the DEC StrongARM I2O product, and the evident importance of EIDs, that appear to have landed on deaf market ears.

Why? For one simple reason. I think the market believes that WIND is fully priced with FY 1999 PE equal to 50, with out-year growth of 37% to 40%. The market will not let the price accelerate until analysts substantially increase out-year earnings estimates and the 3 to 5 year growth rates.

The market may believe that all the recent good news is simply what is required to sustain the growth already discounted in the price of the stock.

Of course the market is wrong - again.

If you are wondering why the analysts don't up their estimates, read my response to Ramsey.

Allen
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