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Non-Tech : RECY Looking Good... A -- Ignore unavailable to you. Want to Upgrade?

To: Brent Usher who wrote (4190)	2/24/1998 10:23:00 PM
From: James Strauss	Respond to of 7006

Early In The Growth Cycle... >>>I am fairly new to RECY and had one concern I wanted to address before buying in. Does the P/E of nearly 76 concern anyone? I realize that the earnings are expected to be increasing but does anyone think that these expectations are already factored into the stock price? Any comments are welcome.<<< ********************************************************************** Brent: Usually when companies are early in their growth cycle it is not unusual to have high P/E's... A good rule of thumb is to multiply the EPS growth rate by .75 to see if the P/E is reasonable... If the P/E is < or = to the number the stock is not overpriced... Ex: Eps growth rate = 100%... .75 x 100% = 75... If the P/E is 75 or less, the stock is not overpriced in this example... In 1997 RECY earned .04 per share vs a loss of .29 last year... So, a P/E of 76 is very reasonable at this time... Jim