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Technology Stocks : Digital Equipment Corp. (DEC)
DEC 14.60+2.0%3:59 PM EST

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To: dav who wrote (3106)4/13/1998 5:35:00 PM
From: hossein hosseini  Read Replies (1) of 3276
 
Thread: What should the fair value of CPQ/DEC combined be?

I tried this. CPQ 1998 earning estimate 1.19 Billion + 340 Million for DEC 1998 estimate = 1.53 Billion.

Number of shares after the merger 1.735 billion ?
Estimated EPS = $.88

Current P/E 24/.88= 27

Considering IBM with a p/e of 17 and HWP with a p/e of 21 why should CPQ/DEC combined have a higher P/E?

Am I missing something? I could be way off on my numbers, got them mostly from Yahoo!. Please discuss
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