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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Phillip C. Lee who wrote (13284)	5/10/1998 9:59:00 AM
From: Michael Feldstein	Read Replies (2) \| Respond to of 213181

Phil, I'm pretty bad at math myself. Could you please lay out for me what Apple's PE would be at a price of $69, based on your projections for their earnings estimates? I would be grateful if you would explain how you use the numbers to arrive at a PE. Thanks in advance.

To: Phillip C. Lee who wrote (13284)	5/10/1998 11:19:00 AM
From: Phillip C. Lee	Read Replies (2) \| Respond to of 213181

<<Simple. I assumed Apple beats the estimates by a 100% in each of the next two quarters. Then I gave Apple 30 P/E ratio, and I get $60.>> Continued- If Apple beats the estimates by a 100% in Q3 and Q4, then Q3's net should be $0.64, and Q4's net should be $0.80 based on Yahoo's Detailed Research data. So, we could come up with $2.15 total net in '98. The PE should be 27.9 (60/2.15) rather than 30. If you want PE 30, the price will be exact $64.5, which is about the middle of $60 and $69. Phil

To: Phillip C. Lee who wrote (13284)	5/10/1998 1:33:00 PM
From: Alomex	Respond to of 213181

Phil, I have no clue why would you compute a P/E of 30 together with the current price. Currently the stock has a built in assumption of a P/E of 20 by year's end, using analysts estimates. If Apple were to solidly beat the earnings estimates, then (and only then) would it deserve a higher P/E (say of 30). To the contrary, you even misunderstand PE definition. You are mistaken. I challenge you to do the math with double the earnings estimates as published by Yahoo, and then give Apple a P/E of 30 by years end. You'll get a figure that rounds to $65. Be careful about your calculation. If you are not good at "math", just don't utter out because this is a public area. Be careful with what you say. It may well end up applying to you...