Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Mike Buckley who wrote (39178)	2/12/2001 12:31:12 AM
From: lurqer	Respond to of 54805

the reason Check Free wasn't working Careful or you may tarnish you reputation as a TALC caboose. lurqer

To: Mike Buckley who wrote (39178)	2/12/2001 2:30:40 PM
From: johndelvecchio	Respond to of 54805

I haven't been on here in a while. Did something change with regard to posting new messages??? Maybe I just forgot something. Anyway, I am not responding to this post directly. Okay to the point. I think that Siebel is cheap. Yep, a cheap Gorilla. I know it's trading at 17 times sales or 300 times earnings or whatever, but that is rear view mirror stuff. One tool that I use in looking at companies is the Internet Bubble calculator. you can look at the method at redherring.com While it can show ridiculous expectations built into stock prices, it can be used to find good values. I made some assumptions about SEBL - namely a 20% required rate of return for five years, a target P/E of 40 in 5 years, target net profit margins of 20% (not unreasonable for a Gorilla software company). The implied expectations to justify the stock price today are 35% revenue growth (the revenue growth is the output from the assumptions made). This is below what the growth rate of the sector is, and I of course made assumptions as to what I think SEBL will look like 5 years out. But, 35% revenue growth sounds reasonable to me. This would imply that SEBL loses market share - which I do not think will happen (but, you never know which is why we take risk). Anyway, I own shares of SEBL, so I could be biased. I guess I just feel a little bit more comfortable about my long-term investment regardless of the current stock price. Best, John