yhoo will continue to go up, regardless of what you think mr. bushy.
My, aren't you the adult? Hadn't been called that in about 30 years.
First, the market's long-term average returns are not 15%, but more like 11-12%.
Second, Mr.Softy's earnings have grown by an average of 34% p.a. for the last five years and only 21% in the latest year. Analyst estimates are for 23% average growth over the next five years. After that, who knows, but it sure won't be 40%. The stock carries about a 60 PE, almost three times it's growth rate. Just for fun, let's see what earnings would be ten years from now at a 25% growth rate. $1.71x(1.25^10)=$15.93. Take that roughly $16 eps, apply a 30 PE (twice the market's longer term average) and you get $480 or a market value in ten years of about $1.2 trillion. And that's, IMO, optimistic.
Try to understand a couple things. 1) MSFT's growth rates of the 1980s when it was concurring the computing world can not be extrapolated to ten years out into the future, unless of course you expect Bill to invent a "warp engine" so that he can find and concur other inhabited planets as well. 2) "My Yahoo!" is not Windows (or even MS-Dos), Koogle is not Balmer, Filo and Yang are not Gates and Allen, and YHOO is not MSFT. YHOO dominates nothing but the minds of its analysts and shareholders. |
