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Technology Stocks : Intel Corporation (INTC)
INTC 34.73+1.2%12:59 PM EST

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To: Diamond Jim who wrote (69857)12/15/1998 8:49:00 PM
From: DAVID BANISTER  Read Replies (1) of 186894
 
CALculating intel fair value for you morons who look at earnings

first of all, a stocks price is merely a reflection of the present value of all its future assumed cash flows,using a discount rate and an assumed long term growth of cash values. I bought intel in july of 1995 at 33 1/2 and at the time I was able to calculate a 12-99 price target of $120 per share using certain assumptions...along the same lines that warren buffet uses. Well, now with interest rates having dropped further, the market is valuing these future cash flows higher, justifiably so. The current fair value is around $120 per share 12-98... and should be around 138-140 per share 12-99. Earnings are not always used to value a stock people... its cash flows...earnings can be easily manipulated, so intelligent investors look at cash flows.
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