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

To: Ali Chen who wrote (44898)	7/25/2001 1:09:52 AM
From: Thomas Mercer-Hursh	Read Replies (1) \| Respond to of 54805

Thomas posted a perfect summary of what I meant to say with my poor and aggressive English, I am quite sure that any similarity was quite accidental.

To: Ali Chen who wrote (44898)	7/25/2001 1:43:47 AM
From: tinkershaw	Respond to of 54805

It is my opinion that when a product promoter resorts to turgid mumbo-jumbo like above, the bubble will burst. Especially when all high-flown words about "comprehensive solutions" and "enabling platforms" usualy boils down to a few interactive fields to fill in customer shipment info, and generate an invoice. I certainly agree there. INSP is my benchmark in regard. I had a brief infatuation with INSP but overtime it continued to occur to me that despite the growth of deals and new products that INSP's receivables kept rising rapidly, DSOs were enormous, and the company never produced any cash. Empty agreements. BEAS suffers from no such problem. Their temprary profits and PE of 280 is also an indication of a "bubble". Sorry. Actually, I've run a discounted free cash flow analysis exactly as an investment bank would to determine the takeout value of BEAS. A Duke MBA does provide some perks. What I get is a fair value for BEAS at around $17 billion utilizing a 10 year CAGR for revenue growth of 29% (Paul Philip assures me this is a moderate estimate;) ). I posted some stuff on the Fool in regard. But I think I only posted the detailed numbers I used for NTAP and not for BEAS. Since the table function works well on the Fool I'll see if I can post the detail BEAS numbers over there tomorrow. But the P/E is not 280 (at least to my memory). Consensus earnings for this year are in the $.40-$.45 cent range (or at least they were last time I checked a few months ago and BEAS has not changed guidance), if memory serves they earning something like $.25 a share last year. But what BEAS is really about, just like MSFT, is a cash machine, and free cash flow. I'll see if I can get it posted tomorrow and I'll provide a link back here. Tinker P.S. Of interest to some here, based upon such valuation modeling, ARMHY is fairly valued if it can grow revenues at a 47% CAGR for the next ten years (not likely, but whose to say). I personally, using figures I thought more realistic, valued ARMHY in the high $1 billions. NTAP comes down between $3-$5.5 billion, depending on how pessimistic one wants to get (upside for those less pessimistic in the near to mid-term). VRTS is around $17-$19 billion. RMBS? Still working on that one.;). MSFT may still be undervalued at a 12% CAGR, but I'm going to look at the numbers in a bit more detail before posting anything. But wow!!!! That is an enormous annuity producing machine. As the most powerful of gorillas can we almost call MSFT a very high-yield bond even with such a low growth rate?