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Technology Stocks : BAY Ntwks (under House)

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To: Frank Ferrari who wrote (4146)2/10/1998 9:07:00 PM
From: WBendus  Read Replies (1) of 6980
 
Frank,

Typically a PEG is used over a 12 month forward EPS estimate. Therefore, since Bay is through its second quarter you should now take the balance of F98 estimates and half of F99 to get a rough approximation of the PEG. This suggests that Bay is trading at a PEG = .87 [(31.75/((1.09 - .46)+(.5*1.57)))/25.8].

Historically technology stocks have traded at PEGs around 1.20 and have been considered "value plays" any where below PEGs of 1.00.

Wayde.
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