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Technology Stocks : PSFT - 1997 Outlook [closed thread] -- Ignore unavailable to you. Want to Upgrade?

To: Melissa McAuliffe who wrote (668)	12/17/1997 8:30:00 PM
From: Melissa McAuliffe	Respond to of 940

To the thread--the most recent issue of Fortune has an excellent article about the ERP industry..even has a picture of Dave Duffield<g> Very good discussion about this industry, where it is today and how these companies will move forward. Very interesting discussion of the size of the midmarket. Projections are that this segment has a potential to generate $7.3B in the next two years. Whatever PSFT's share of this is, it represents new business. Also mentioned that both SAP and PSFT will increase their sales staffs by 80% next year. A quote from Dave Duffield "We're kicking ass in higher ed". Anyway, I strongly recommend reading it. hmmmm...now why would PSFT increase their sales staff by 80%? If sales per rep minimally stay the same and if margins stay the same then the conclusion must be that we will see another year of 75-80% growth. Projecting this out to FY1998, eps should be approximately .74. @$45/share (approximately a 40% increase over today's price)this stock would have a P/E of 60. Though, as long as investor's are willing to pay a premium for this company because it delivers, the stock could be at $55 and only have a PE of 74. Paul--I hope I got these numbers right because I know I will hear from you if not<g>. Hank-I think you should cover your shorts before you lose your shirt. Melissa