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Technology Stocks : ADI: The SHARCs are circling! -- Ignore unavailable to you. Want to Upgrade?

To: Ren Liu who wrote (1315)	9/16/1999 11:33:00 PM
From: Bill Martin	Read Replies (1) \| Respond to of 2882

No -- the PE's provided are correct, based on historical earnings not projected. The trick though is that you have to use the same four quarters to add up to a year with fast growing companies, even when their fiscal years end in different months. I come up with ADI selling at $57 today with the last four quarters of earnings about $0.83 which says PE is 68. MXIM had earnings of $1.80 divided into today's price of $72 => PE 55. IMHO, "to control your fortune", as you say, it's vital that you DON'T use earnings projections made by Wall Street analysts. If you're going to do that you might as well let them buy/sell for you too via mutual funds. My approach is to use historical PEs and to modify them by my own pro forma projections from the earnings & balance sheets. You start from Historical data though which is known and more or less immutable. You don't use analyst's projections under any circumstances. That's simply equivalent to using a table computed by others as you say. Your mileage may vary .... Bill