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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: FR1 who wrote (66364)	3/24/2002 2:54:04 PM
From: Timetobuy	Respond to of 74651

Retailers don't get high p/s because margins are less than techs. I own some retailers but I don't own wmt. On what basis was their growth rate 70%? If it was on sales, then no way they are going to make that again on a sustained basis. If that were to happen they'd be selling almost 4 billion dollars a year in 2006. I think their sales growth is about 12-14% which is pretty damned respectable for a large cap retailer but it's highly doubtful that it rises much over that. I think earnings growth is maybe 14-18% on the high side which is also pretty good for a big cap retailer. How can it grow much over that without revenues also rising considerably? Margins would have to rise and I don't see that happening within the sector they are in. The free cash flow on walmart is 800 million bucks ex dividend or 2 billion including the dividend. If Walmart gets back to it's all time high of just over 70 then the market cap is going to be about 300 billion. What does that make market cap to free cash flow? 150 times including the dividend! That's bubble high, FR1. What is the free cash flow on msft? 12 BILLION with a B! (27 times). Csco is 6 billion or slightly over 20 times. And the fundamentals of techs are so terrible? What if the techs got to 150 times cash flow? Nasdaq 10,000 no problem! I'll pass on walmart. Maybe it goes higher, but not with me on board. Amat. Good article last weekend on the valuations in the chip equipment makers. They're mo mo favorites, so they can go higher, but every time Amat announces a split they peak out. I bought puts on it on the open Friday. Plenty of stocks peak when they announce a split. Two that I remember quite well are Iomega and Applied Micro Circuits.