Valuation is a tricky question, especially with these companies. There's a lot of good discussion going back to the beginning on the Safeguard thread about this, but it is generally assumed that SFE trades around (usually a slight premium to) the value of its public portfolio, so you end up getting all the private companies for free.
I'm specifically invested in SFE for the new IPOs ("rights offerings"), so that is what I'm looking for in these companies. Therefore, INTC and MSFT would not be on my list, anyway. The key factor, then, in my opinion, is the management of the company, since that is really what you are buying. Anyone can give money to a company, but not many can use their expertise and talent to grow the company and make it successful. Safeguard has a track record of doing this (and so do Intel and Microsoft as you pointed out, but not as their main focus).
Recently, it seems, Safeguard has also started increasing investments in already public companies to try to turn them around (LASX, LUXY, NM). Many of these stocks are way off their highs, and could be of additional speculative value.
Basically, to value any of these "venture capital" companies, I would look at their public portfolio and assign a value to that, look at the private investments, and look at the management and track record. Not really easy if the structure of the investments is complicated (multiple parners, VC firms, and funds), but it's the best shot, IMO.
--John |
