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Microcap & Penny Stocks : ACRT about to move to new highs
ACRT 0.110-7.6%Dec 30 4:00 PM EST

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To: Doug R who wrote (3367)3/15/1998 5:32:00 PM
From: Andrew Q. Viet  Read Replies (1) of 7054
 
Simple Math:

Zacks published Earnings Growth Rate for ACRT = 75%. Let's assume that ACRT can keep up with this growth rate for 5 years. Let's calculate earnings 5 years from now

FE = PE*( 1 + EGR/100)^ n

FE = future earnings
PE = present earnings ( Last 4 Quarters= $.43/share)
ERG= Earnings Growth Rate ( 75)
n = time frame compounded ( here once a year over a period of 5 years)

FE= .43* ( 1 + 75/100)^5 = .43*(16.413) = $7.058/share

Let's ascribe a P/E of 20 which is very conservative, each share will be traded 5 years from now.

P/E = 20
P = 20*E = 20*( 7.058) = $141/shares

Note: for simplicity potential future share dilutions are not included in the equations.
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