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

To: charles moore who wrote (3964)	3/12/1998 4:16:00 PM
From: pham	Read Replies (1) \| Respond to of 14266

>>Meanwhile since we presently don't know the terms of the license renewal we dont know what the Margins would have been or how much more could be wrung out of the existing franchise.The people need to listen to themselves on this Board. Previously most messages talked about what a Genius CEO Farrell was and now based on whatever Logic the Guy is an Idiot and People want to Dump the Stock even before knowing the exact details.<< Funny how the psychology could do to people. One day Farrell was great, and next day He possibly made the biggest mistake in his carrer? I don't think Farrell have not thought this one out. He must have some thing up his sleeve !!!. 2c opinion.

To: charles moore who wrote (3964)	3/12/1998 4:25:00 PM
From: Trippi	Read Replies (2) \| Respond to of 14266

Charles your post made no sense to me -- If this, and If that.... and should mean this etc. No all earnings are not equal and math is math but it kind of depends on what PE you put in the equation. Put in any PE you want -- the only one that matters is the one the market will pay. My guess is 2X WCW related earnings 25X non-WCW related earnings 2x .53 = $1.06 25x .82=$20.50 total = $21.56 on $1.35 trailing earnings (we closed today at $21 3/16 I believe) Assuming $1.80 for fy98 and WCW related earnings representing 29% of total fy98 earnings -- you get a year end target of: 2X .52 = $1.04 25X $1.28 = $32 end of fy98 target $33 The hardest part of the fy98 equation will be to have WCW represent just 29% of earnings. You can fault my math all you want -- I am long THQ -- have been since I bought in the 7's -- but this is how I think the market will value THQ until we get WCW off the books. Trippi

To: charles moore who wrote (3964)	3/12/1998 5:01:00 PM
From: Quad Sevens	Read Replies (1) \| Respond to of 14266

<<< the only Criteria should be if each quarter is a certain percentage better than the last whatever your parameters are in that regard >>> That is true. But to attain a high PE, that percentage must be extendable well out into the future with reliability. That is the way a valuation model for a growth stock works. Once that reliability is gone, the PE goes with it. WCW, instead of yielding a lucrative stream of earnings for the foreseeable future, a base on which to build future earnings, will now die an unnatural death (just as the stock appears to be doing now). That base will soon be gone. The old reliability (or at least the perception of it) is gone. So is the old PE. WCW may account for 75% of this quarter's earnings! These earnings will be fantastic, but analysts will be badgering Farrell about the WCW percentage. It's lose-lose. If he breaks out this percentage, it will look bad. If he doesn't, it will create more uncertainty. Here today, gone in a year. Wall Street pretends to look out a long way (it doesn't, but it pretends), and it hates uncertainty. What is certain is WCW revs will stop in 15 months or so. What is uncertain is how good Quest, RugRats, ... will be (they look good, but who can say?). Furthermore, even if these are smash hits, might it be the case that THQ loses these licenses too? THQ is suddenly looking riskier. High risk = low PE. Wade