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Strategies & Market Trends : Steve's Channelling Thread -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (8717)	12/7/2000 8:30:16 PM
From: Mark Johnson	Respond to of 30051

New coverage on Valence: gkm.com We are initiating a BUY rating on Valence with an initial 12-month price target of $17, as it has a strong position in next-generation lithium batteries for mobile devices. As events unfold that lower risk, we expect to increase the price target. The clearance of the Telcordia intellectual property purchase by the Federal Trade Commission, expected in December or January, will likely have a material impact, as will the manifestation of better shipping and yield capabilities that we expect to see in the December-quarter release." *** "We arrive at a 12-month price target of $17 as follows: A 40x terminal P/E multiple suggests a possible FY06 terminal value of $56 per share. The discount rate to be applied to such a figure depends heavily on risk. At present, we use a 33% discount rate to account for early-stage risk, to arrive at our 12-month price target of $17. However, as events unfold, the business risks and the discount rate should narrow, and the price target will likely increase...