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Technology Stocks : Gateway (GTW)
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To: Kory who wrote (6482)8/13/1998 2:12:00 PM
From: Skeeter Bug  Read Replies (2) of 8002
 
kory, my only issue is i don't understand the logic of valuing gtw at $55-$69 when they are earning less than when they were trading in the $20s in 1996. of course, lower interest rates play a part. however, they don't account for a more than doubling of share price on faltering earnings.

i think the bears, other than having believed the pc cycle has peaked and we are on the way down, believe that gtw stock is rising, not due to fundamentals, but due to the cheap money concept. too much money makes it cheap. "hey, it has to go somewhere..." how cheap can it be in light of crap fundamentals - a 6% growth rate is crap for a 28 pe stock!

please don't cite dell as being an indicator that pc eps growth is still strong. they are the only ones left. hwp is cutting salaries and increasing days off. muei is losing their shirt. gtw can't grow. ibm can't grow. toshiba left the consumer market. sony's entry has been drastically scaled back.

my bet is that dell becomes like the industry and not that the industry becomes like dell.

good luck. hey, do you have any cheese for our whine ;-) i think gtw holds pretty strong through dell eps (imagine the logic of gtw's strength going into dell's earnings when dell is the assisin that is killing gtw! ;-) and then we trend into the $40s.
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