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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Lynn Segal who wrote (14031)	10/15/2000 2:11:47 PM
From: Lynn Segal	Read Replies (1) \| Respond to of 275872

Can anyone tell me how you can justify a pe of 508 and a price/sales of 60. (Ken Fisher claimed anything over 3 was gambling.)I'm talking about PMCS. Does anyone think this stock can grow into these multiples? Anyone considered buying puts?

To: Lynn Segal who wrote (14031)	10/15/2000 2:54:04 PM
From: niceguy767	Respond to of 275872

Lynn: "For your low stock price estimate of $50 next year: What is your estimated 1)revenue, 2)earning, 3) rate of growth for earnings ttm. Also, what is your assumptions about INTC in any regarding this $50 estimated stock price. Let's assume macro economic events non issue." Comment: I have never really looked at INTC's financials...For some reason they just haven't piqued my interest...My only interest in INTC stems from what they are offering in the "here and now" in the microprocessor sector vis a vis AMD and there is little doubt in my mind the any relative technological edge they held 1 year ago has vanished... As mentioned earlier, owing to the world leading technolgical edge owned by AMD in both its flash and microprocessor divisions, a 25% revenue growth rate next year would seem a certainty assuming continuing "robust" or even "just good" macro growth in both sectors...Upside is 40% comprising $2 billion in flash and $5 billion in processor revenues...Earnings are a little more difficult to project at this stage as it is virtually impossible to determine when the Athy demand curve will cross the Athy supply curve at which point strongly rising ASP's enter the equation...My eps guess for Y2001 is a range of $2.50 to $7.00 at this time and I'm not too uncomfortable at $3.50 to $5.00 at the moment...Obviously, the $7.00 assumes AMD will exceed the Q4 target of 7.6 million Athys in which case the demand curve would likely cross the supply curve in Q2 at the latest. It also assumes that P4 will not materialize as a significant "volume" threat in Y2001 for either or both production and non-competitive reasons...The $2.50 assumes AMD will miss the Q4 target by a wide margin thereby indicating a later crossing of the supply curve... For AMD to remain at $22 in Y2001, I'd estimate a revenue growth rate of below 10% and an Y2001 eps below $1.00 and an exceedingly competitive P4...$50 is easily supported by a 25% revenue growth rate and earnings of $2.50 (i.e flat)...$150 is easily supported by a revenue growth rate of 40% and an eps of $3.50...Sure hope we get to see what happens with a Y2001 revenue growth rate of 40% and earnings of $5.00 or better...If P4 isn't a major "volume" threat in Y2001,(and it's not looking too ominous at the moment, imho) , then for AMD, earnings upside is enormous, as competition in the 1 gig plus range will be thin and demand enormous in all likelihood...