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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: that_crazy_doug who wrote (100927)	3/30/2000 1:06:00 PM
From: tejek	Read Replies (1) \| Respond to of 1573950

<< Growth in eps has come up before in re to Intel. While its good to see, often the street will assign a higher valuation to the stock not with the best EPS but the best revenue growth. >> AMD should get at the very least get 50% revenue growth year over year, and they could quite possibly get over 100% revenue growth year over year. I am unfamiliar with the revenue growth rates of the other companies, but I think a number over 50% in revenue, and earnings over 4 bucks will earn the stock a considerably higher multiple. Last year AMD's revenue growth YOY accelerated from 13% to 23%. Should that rate of growth continue to accelerate to your 50% figure, then all bets are off. AMD then will be emulating the CSCO model and an assignment of a higher P/E is inevitable. However AMD is a mature company in a mature industry; major growth can only come from stealing market share from Intel ....I suspect sustaining a YOY growth rate of somewhere between 20-30% will be the best AMD can do. I think we will know better after this quarter. Most people would accept one of the things holding amd back is the checkered past. Most people still don't believe AMD is for real yet. With each passing quarter more people will buy into AMD's story. It's really a simple function in some ways. If AMD had 10 bad quarters in a row, and claimed the next one would be good, who would believe them? Well let's say they had 10 good quarters in a row and they said the next would be good, who would believe them? The answer to the first question is no one, the answer to the second is everyone. Well they've got 1 good quarter in a row now, how many people believe them? How many people will believe after 2? after 3? etc etc.. I don't know how long it'd take to get everyone, but I think after 3 quarters you'll have enough of a following to boost the multiple up. Plus with our increased earnings, we'll be looking at a huge stock boost even without a bigger multiple. I think AMD's credibility issue will be overcome in the next 2 quarters and that it will become a non issue. I think, like with any other company, the rev. growth figures ultimately will determine where AMD's price ends up. ted