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Technology Stocks : Oracle Corporation (ORCL) -- Ignore unavailable to you. Want to Upgrade?

To: Carmine Cammarosano who wrote (3960)	12/9/1997 1:53:00 PM
From: Xpiderman	Read Replies (2) \| Respond to of 19080

>>20 times next year's earnings = $22 a share for Oracle...Next years earnings have now been cut to $1.10...<< Why would you use 20 times earning, instead of 15 times earning (15% growth last Q) or 30 times earning (long term growth rate)?

To: Carmine Cammarosano who wrote (3960)	12/9/1997 2:26:00 PM
From: Thomas Dremel	Respond to of 19080

Even with the cut of next year's earnings to $1.10 - this stock is now trading at a discount to it's growth rate. Conservatively, the company should grow at a 25% clip over the long term and should be trading at 25X1.1 = $27.50. This is being conservative, since the market has been paying a higher multiple than one to one (PE ratio vs growth) - especially for the blue chips. This reminds me of the networking fiasco we had earlier on, and it's important to note that the leader comes back first, ie, CISCO in the networking. I rate ORCL as a leader that will bounce back in the next couple of months. What happens to the stock in the next few days is anybody's guess - but over the next few months serious money can be made. tom d