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Non-Tech : The New Iomega '2000' Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Ausdauer who wrote (1465)	7/6/1999 9:47:00 PM
From: Cogito	Respond to of 5023

Ausdauer - Homework? I was asking a legitimate question, and I don't think you had any call to start lecturing. So Sandisk is going to earn 1.20 per share this year in gross royalty receipts. Is that going to help them justify their current Price/Sales ratio of 8.67? Is is going to help them justify their P/E of around 106? I do know that Sandisk's unit sales are increasing rapidly, and that there is every reason to expect that they will continue to do so. On the other hand, there are reasons to believe that the stock price has gotten ahead of the company's real earnings. Note that Sandisk's revenues for 1998 were down significantly from 1997. A buck twenty in royalties isn't going to put much of a dent in that valuation if they can't make money on their number one product. It's the same argument that has been applied to Iomega for years. - Allen