Hi Michael,
I am also a subscriber of Gilder Tech news letter. The only reason
I subscribe his news letter is I don't want to miss out some good
opportunities. Since he is talking some thing I can understand, I
figure that I could not loss much. If what he said making some sense,
I will take a look, otherwise, I just simply ignore it.
In his ACENDANT list, only one company seems making an investment
sense to me, that is QCOM. reason 1) it is projected growth rate for
1999 is 58%, and the stock only sells at 145/2.72= 53 PE currently.
2) The company has 130 CDMA patents and 400 are filed and still
waiting for approval. 3) Recently a deal struck with ERICY is going
to help them improve their fundamentals, namely earning.
I have done a little home work on the company. They have 5 products
lines: OmniTracs Mobile communication station, CDMA technology, Eudora
Email software, Globalstar Mobile Satellite System, and CDMA Infr.
products(which is selling to ERICY).
The financial fundamental has suggested this is high growth company
with past 5 years average growth rate of 54%.
Only one area it has done very poorly. That is its net margin, only
3.4%. Comparing with other traditional growth companies, MSFT, INTC,
CSCO, DELL, and VTSS. QCOM is nowhere near its peers. This also
reflects its management efficiency. Only $10,000 net income per
employee.
Because of its management efficiency, I am not convinced at this
point that QCOM deserves Gilder such a hype on the company.
Could you shed some light on this?
Cheers!
Mike |
