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Technology Stocks : Cymer (CYMI)

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To: michael modeme who wrote (14836)2/19/1998 1:34:00 AM
From: Czechsinthemail  Read Replies (1) of 25960
 
michael,

I'm saying value is different from price, and I think you are trying to equate them. I'll leave it to Curly to explain "CYMI has a fair value of $60" since that is his baby. But he might have used something like Benjamin Graham's formula for determining value for growth stocks. Graham's formula was:

Value = Current Earnings X (8.5 plus twice the expected annual growth rate)

If you assumed a growth rate of 30%, this formula would come up with a value of: .86 X (8.5+60) = $58.91

Maybe Curly overvalued it a bit.

Baird
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