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

To: Joe Sabatini who wrote (5232)	2/24/1998 6:48:00 PM
From: Ed Schultz	Read Replies (1) \| Respond to of 74651

>>Are value investors 'poor investors'? Once again I think you are confused. Comparing the value of a company versus the valuation of a company are like comparing apples and oranges. Microsoft is a great value. Show me ANY other company with the tremendous and consistent growth that Microsoft has had in the past 10 years? Simply put, there are none! In my book, that makes Microsoft a very valuable company. And the reason the "herd" invests in this stock is because, unlike some people, they too see the value of this company. They also realize that for the foreseeable future (3-5 years) no other company in existence has as rosy and predictable (ie stable) future as Microsoft.

To: Joe Sabatini who wrote (5232)	2/25/1998 6:35:00 PM
From: Tom Kearney	Respond to of 74651

Joe, I think one factor is that 1/3 of MSFT stock is tied up by three people, all youngish, who are unlikely to sell significant amounts anytime soon. So there are really only about 1.3B pieces available. Another reason is me. And people like me. I have shares I bought only 3 years ago, that are worth 5.5 times what I paid. Unfortunately, I own these outside my IRA, so if I sell, I have to pay uncle SAM $20 per share or so. Do I want $80 of MSFT stock or $60 in cash? Since I have a good job, and invest to retire, I'm 'a holding. Thirdly, ROE. This is the measure of a company's ability to turn money into even more money. MSFT ROE of 37% is almost unbeatable. Of the stocks I follow, only MRK is close. (INTC is 32%, also very good, but somewhat less.) Finally, with NT and SQL*Server about to burst forth, I don't believe MSFT is close to plateauing. (Just my opinion.) Regards, Tom