How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 485.49

+1.8%

Nov 26 3:59 PM EST

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To: Bearded One who wrote (12137)	11/7/1998 10:07:00 PM
From: DavidD	Read Replies (1) of 74651

To justify the current stock price, and p/e, MSFT must keep the current earnings growth rate intact. To do that MSFT must dominate the next big wave: They have to dominate with Win2000 (both the client market and the NOS market), and whatever comes after that (embedded market?). While I won't bet against them, I don't think the market fully understands the risk in this stock. If they fail to keep or gain a choke hold on any of the above, they can't keep their growth rate going through the next five years. (However, there is hell of a lot of money to be made between now and then!) Win95 was as much luck as genius on the part of Gates & Co. If it wasn't for the internet and connectivity issues, the demand for Win95 would have been much less, the upgrade cycle much more subdued, and earnings would have slowed. What will propel me to by Win98, much less Win2000? I wonder how earnings would be impacted if 1/3 of all clients skipped every other OS upgrade?

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