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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (13534)	12/18/1997 12:12:00 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

GM, Just MO, but I believe the next tech rally will begin and be sustained by the second tier names(ie. not INTC, MSFT, or CSCO) The Big Three are richly valued IMO in this tech environment where many are trading 10X FY98 and near BV. According to many of the eps forecasts I've seen for INTC for FY98, they should have near flat eps growth. IMHO, once the panic around SEA subsides, techs that can show higher levels of eps growth will be rewarded, Read: AMAT. With company guidance of $2.08-$2.15 for FY98, AMAT is positioned to grow 40% next year, yet the price does not reflect it since nobody at the current time believes it except for me. BTW, I've done some simple math to try to determine what people are paying for each % point of growth for KO vs. AMAT using next year's consensus of $1.73 for KO and a downwardly revised # for AMAT of $2.00 and assuming a 5 yr growth rate of 11% for KO and 22% for AMAT. KO is currently trading at 3.47X (($66/$1.73)/11) its expected rate of growth while AMAT is trading at .625X (($27.5/$2.00)/22) its expected rate of growth. Please note that in my estimation, AMAT's growth rate will be higher and KO's will probably be lower than the #'s used in the example. This and .75c will buy you a cup of coffee. Regards, Brian