CHMD low risk below 15: Potential 50 Message Board

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Non-Tech : CHMD low risk below 15: Potential 50

CHMD 0.00

Jun 29 5:00 PM EST

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To: jfrancis who wrote (200)	2/26/1998 11:16:00 AM
From: Dan Turner	Read Replies (1) of 241

Yes, I do still think they have a potential to hit 50. When insurance companies learn how much $$ they save by signing up with CHMD more and more of them will do so. CHMD hasn't been announcing all the good things going on lately, but they keep beating estimates, and this is a large part of the reason why. This was alluded to in the last conference call. So, there's every reason to think that CHMD's growth will continue at least at 25% yearly for at least the next 5 years, probably much longer. I think, in fact, that CHMD will do even better. Well before then the market should once again see what a good growth story CHMD is and will likely value it accordingly. Some back of envelope calculations and naive assumptions: 25% growth for the next 5 years, PE=growth rate, this year coming in at $.56. This would give earnings of $1.71 five years out. With a PE of 25, the price would be $42.70. I think this is quite conservative, so the potential is there easily for $50/share. FWIW. -DT

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