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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Charlie Smith who wrote (26011)	5/31/2004 4:04:36 PM
From: Art Bechhoefer	Read Replies (1) \| Respond to of 60323

Charilie, regarding ROE for SNDK, comparing SNDK and Intel may be misleading. While INTC had more proprietary products, than SNDK has, INTC sells mainly to computer manufacturers or assemblers. SNDK sells to some manufacturers but also has a much stronger retail footing. The combination of high margin retail outlets and at least some royalty fees suggests to me that your 14% ROE may be too low, and that 18 to 20 percent over the long term may be more realistic. In the shorter term, at least while demand outpaces supply, ROE may be of the order of 20 to 24 percent, justifying a price-earnings ratio much higher than the current level. Art