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Technology Stocks : Wind River going up, up, up!
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To: Michael Greene who wrote (550)2/23/1997 12:11:00 PM
From: peter grossman   of 10309
 
Great post. I am looking to add to my position.

I got a package in the mail yesterday which included recent press releases and analysts' coverage and projections. Wind does a very good job of PR to the investment community. Given the current p/e I am in this stock because of Allen's pursuasive arguments that Wind's business model and execution guarantee that while the top line will grow, the bottom line will grow substantially faster because of three factors:

1) Licensing revenues require no cost of goods.
2) Design wins in past quarters will yield profits in present and future quarters.
3) The magnitude of potential markets for design wins keeps increasing.

I think these factors create a uniquely comfortable position for a long term investor.

The analysts revenue projections for licenses did not seem that high going out. Perhaps, this is good in that they provide milestones that Wind can beat. However, if they are right, a "meager" 40% growth rate won't justify the current p/e. I am looking for an earnings growth rate so high that it will lower Wind's p/e while the stock rises.

Will this happen? Any thoughts? Should I wait for Allen's return for an answer?

For an investor looking to add to a position, what's a good entry point? Any thoughts?
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