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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Bearded One who wrote (4301)	12/15/1997 8:25:00 PM
From: John F. Dowd	Read Replies (1) \| Respond to of 74651

Dear Sir: The PE of MSFT is high because they don't disappoint. And as Lord Middleton has pointed out they have, for the near term, a pretty good handle on their earnings and the surprises can only be to the upside. What other growth company do you know of that 1. dominates (pardon the expression) their field and 2. consistently lives up to earnings expectations. Or are you saying that MSFT won't make their earnings estimates? If you are sure that MSFT is going to disappoint then you are on the right track but it would appear that this latest down draft is all myopia. Nonetheless, I for one I do appreciate your negative point of view because by assessing the strenght and validity of the opposition one can assess the same about his own point of view without having to do so in a vacuum. What are your fundamental biases vs. MSFT? Every time you criticize you have actually been lauding their business acumen. Now on the other hand you might think that all stocks are too pricey in which case you should buy puts on the Index and not fool around with just MSFT. But you see in these troubled times with market sentiment going against tech stocks and DOJ acting as lead dog for NSCP and Novell, MSFT is holding up very nicely for the very same reason that it has a high P.E. Now if you have some inside info that MSFT is going to "miss" share it with the brothers here on the thread so we can all benefit from this special information. Absent that please come up with someting stronger than an opinion. Concerning the analogies: those are precisely the ones MSFT employed on the conference call today in explaining their position. In fact I think they have been reading my mail - of all the nerve. In any event keep up the effort as devil's advocate as one must always have something to compare one's own assessment against. But you would do us all a service if you would come up with something substantive to realy ponder over. Concerning my loss of wealth: as my wife says it ain't yours until you cash it in and that is why I am thrilled that Gates is so young. He won't be cashing too much in for a while but in the meantime who do you propose to hitch your wagon to? Cheers, JF Dowd Are you really bearded and if so do you wear a bow tie?

To: Bearded One who wrote (4301)	12/18/1997 9:20:00 AM
From: Reginald Middleton	Read Replies (2) \| Respond to of 74651

<Microsoft is overvalued and is regressing towards the mean. That's probably a lot closer to 20x earnings in the long run than 50x earnings> What does that mean? Wnat does the "mean" have to do with MSFT's valuation? MSFT's valuation is based on a forward looking perpsective, not a rearward one. It appears as if your driving your car through the rearview mirror. Produce a valid argument in regards to MSFT's valuation. <I feel your pain in your loss of wealth from Microsoft's drop in stock price.> Go to MSFT's five year (the average investment horizon) chart in SI. What loss of wealth of MSFT shareholders would you be referring too? I would like to "lose" wealth at that rate for the rest of my life:-)