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

To: Wizard Wannabe who wrote (5577)	2/19/1998 11:11:00 AM
From: J P Cross	Read Replies (1) \| Respond to of 19079

Wiz, While the model your are using reflects the fair value of the stock based primarily on earning and earnings growth I would like to know what the fair value of ORCL is based on R&D expenditure. Am in the process of reading Michael Murphys book "Every Investors Guide to High-Tech Stocks and Mutual Funds". The book is good but I'm far from finished. I bought the book primarily to learn how to evaluate a High-Tech company based on R&D expenditure. Michael Murphy has a formula for finding the fair value of a stock via a calculation using R&D spending of the company. ORCL is a blue chip leader in R&D and I would bet that the fair value based on the future product development would make ORCL look like a cheap stock today at 26. It is the future potential technology break through and product development that make a technology company so valuable. Look at the R&D MSFT and INTC spend. That is why IMO these two have little to no competition. Show me a high-tech company that neglects its R&D spending and I'll bet you will see a company with a shortened life span. Regards, JCross