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 : Buffettology -- Ignore unavailable to you. Want to Upgrade?

To: bozwood who wrote (3111)	10/17/2002 11:00:59 AM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 4691

>For instance CSCO. The company will need to grow the > bottom line 20.1% for 10 yrs to justify the price today. Which is totally meaningless statement given that $1.9B "bottom line" Quicken starts from is not indicative of CSCO earning power. Why don't we start from -$1B that CSCO lost in 2001 (this would require almost infinite growth rate)? How about $2.7B CSCO earned in 2000 (this would require 15% growth rate)? With such earnings variability, starting from $1.9B and asking if 20% growth is possible is pure guess. It is possible for CSCO to go back to $2.7B in two years, or not to get back to this number ever again. Throw a coin or visit your friendly neighborhood psychic. Jurgis - Quicken calculation may have value for companies with little earnings variance