MicroStrategy Inc. (MSTR) Message Board

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Technology Stocks : MicroStrategy Inc. (MSTR)

MSTR 170.90

-4.7%

Jan 15 3:59 PM EST

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To: treetopflier who wrote (166)	9/29/1998 5:09:00 PM
From: growthvalue	Read Replies (1) of 717

Hi ttf- I'm having trouble justifying the current price of Microstrategy as well and was wondering what you thought of the following analysis: Let's assume the analyst's consensus EPS estimate for next year of $0.29 is correct. The analysts' consensus 5 year growth rate is 45%. Let's assume for the sake of argument that they are being too conservative there. That way we can account for the upside surprise potential. If I assume that MSTR grows EPS at 75% in 2000, 60% in 2001, 45% in 2002, 45% in 2003, and then 30% in 2004 and 2005, and I assume perpetual growth of 5% thereafter, using a very aggressive discount rate of 7% for the explicit forecast period and 10% for the perpetual period, I get a value of $40.75 per share. My conclusion is minimal upside even given extremely aggressive assumptions. GV

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