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Technology Stocks : Wind River Systems - Technical Analysis

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To: William who wrote (80)12/1/1997 12:36:00 PM
From: Peter Church  Read Replies (2) of 431
 
Wind's stock had a slow year in 1997.

In 1995 and 1996 Wind's stock price went up 150% per year. In 1997 it only went up 33%. Did it break the winning streak or were the previous years' expectations too ambitious?

Actually, a case can be made that Wind's price is right on track. Wind's earnings per share doubled in FY 1996 and 1997. If the price had corresponded with these earnings, the stock price would have been 10 and 20 in January 1996 and 1997 respectively, doubling to 40 in January in 1998.

Thus, the 150% rise in 1995 and 1996 was too ambitious and we now are more in line with the earnings per share growth at $40.

If the trend from 1995 and 1996 had continued, the price now would have been $80 per share.
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