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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Trippi who wrote (3960)	3/12/1998 3:41:00 PM
From: Sigmund	Read Replies (1) \| Respond to of 14266

It would be useful for someone to make a projection of THQI revenues and earnings sans WCW. We could apply a conservative 15 PE and see what that looks like. To that we could add perhaps $1 to represent the present value of WCW earnings through mid 1999. I think Farrell would have better off selling the future rights to WCW now - mid 1999 to ERTS to complete the picture. We now will be dealing with this problem for five or six quarters and it would be better to get rid of it now and start fresh. One problem I think we have is the fixed versus variable cost issue. THQI doubled sales and earning went up by a factor of five I believe. Do I have that right? If you take away 39% of sales, what do you do to profits? Upon reflection, I think we got in trouble when PAX turned out to be mediocre. WCW bailed the company out of its problems with PAX but without WCW we now are relying on hope for future products and untried concepts. It really is a setback from a development stage perspective.