Egghead Computer (EGGS) Message Board

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Technology Stocks : Egghead Computer (EGGS)

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To: Aladdin who wrote (838)	7/10/1998 2:22:00 PM
From: Leeza Rodriguez	Read Replies (2) of 8307

At $21, EGGS has a run rate PSR =4. Run Rate PSR is the current market cap divided by the last quarter of INTERNET revenue x 4. In E-tailing speake a PSR=4 is _still_ cheap. Ladies and gentlemen, this is a story of p-r-o-d-u-c-t-i-v-i-t-y. This is a story about how using the Internet as a distibution channel yields SGA reduction and the corresponding increases in bottom line EPS. The model bodes especially well for companies which sell lower margin products. I bought shares in the company several months ago when we (the thread) determined that the PSRrun rate=2. I bought more at $10 following the earnings report. I am rather surprised how long it took the institutional money to figure this one out. But on the other hand, maybe this is a blessing because money is now flowing OUT of the Yahoo's and the Amazon's of the world (with PSR's > 20) and into EGGS. Congrats to the early longs. I guess we weren't so crazy after all. ;-) Leeza Rodriguez

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