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Technology Stocks : Western Digital (WDC) -- Ignore unavailable to you. Want to Upgrade?

To: Thomas George Warner who wrote (7808)	11/23/1997 7:19:00 PM
From: Brian Lempel	Read Replies (1) \| Respond to of 11057

You are wrong regarding p/e ratios. Christopher had a good point about the expansion and contractions of them. The p/e is low now because the future looks bad, but trailing earnings were good. A year from now, the p/e will be high (relatively speaking) because TTM earnings will be low, but future prospects will be looking good. That is why $15 is a ridiculously low target and will only be met if there are prolonged pricing pressures. Brian

To: Thomas George Warner who wrote (7808)	11/23/1997 8:31:00 PM
From: Pierre-X	Read Replies (1) \| Respond to of 11057

Re: Short term growth rate You said: If we assume that WDC has an earnings growth rate over the next 12 months of 20% (I believe a conservative value)... 20% EARNINGS growth is NOT a conservative projection. Very optimistic, actually. -IF- we are on the east slope of a downcycle then earnings growth could be negative for a while. Earnings have already declined for 2 sequential quarters. You said: In the case of WDC it has never had a PE of 15 since 1984 if my data is correct. According to Zacks the 5 year average PE for WDC is 11.6. You said: ...we assume earnings next year of $3.00/share... Company's guidance for F98 is $1.50 to $1.70. PX P.S. I am not short any DD sector stocks. <g>