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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: tekboy who wrote (26638)	6/22/2000 11:53:00 AM
From: hueyone	Read Replies (4) \| Respond to of 54805

More Flash Tek, Thanks for referencing the AUS post. One quick comment regarding the valuations of the two companies. When I made my original SSTI post in the wee hours of Tuesday morning, SSTI had closed at $89.44 on Monday and was selling at 25 times projected calendar year 2001 earnings. SNDK closed at 68 on Monday and was selling at 54 times projected calendar year 2001 earnings. Even today, two days later, with SSTI breaking out to new highs at 114, it is still selling at 32 times calendar year 2001 earnings versus SNDK (at 74) selling at 59 times calendar year 2001 earnings. In addition, analysts are looking at calendar year EPS growth projections of 104% for SSTI versus 44% for SNDK. So with regard to near term projected earnings and near term projected growth rates, it can be argued that SSTI is a better buy. It is entirely possible, however, that the projections for SNDK are understated and with new capacity coming on SNDK will blow away the estimates, but apparently no SNDK analyst has caught on to this if indeed this is the case. On the other hand, the numerous analysts covering SSTI appear to have a high degree of confidence in next year's average $3.51 EPS projection for SSTI. But with regard to strength of IP, which is critical to members of this thread, AUS may be right that SNDK is in a better position and hence is a long term play more suitable to members of this thread. I am a complete ignoramus compared to AUS when it comes to evaluating strength of IP in flash memory. However, I do have some research from other analysts that view SSTI's IP favorably that I hope to bring forth in the next couple of days. Overall, like you, I am optimistic that the industry wide flash memory tornado will lift both these companies and I have positions in both. Best regards, Huey