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.

Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: cfimx who wrote (48218)	4/12/2002 9:20:01 AM
From: Charles Tutt	Read Replies (1) \| Respond to of 64865

You're taking taxes out twice (or underestimating pretax margins). Value Line shows operating margins of around 20% in '99-'00, and net after tax margins around 10-11%. And they've taken out a lot of cost, which should help margins going forward. If my 20% is too high, your 6.5% is too low. Even 12% on $20B would be $2.4B, or .74 / share on 3.25B shares. With interest rates as low as they are, and with the growth rate we've been talking about, I think a PE of 20 is too low, too. I'm going to stick with 35, giving a price around 26. Still not bad, even for a two year wait (and with Hewpaq disintegrating, it might not take that long). The additional revenues could come largely out of IBM and they'd hardly notice. <g> JMHO. I encourage everyone to do their own due diligence. Charles Tutt (SM)