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Technology Stocks : eidos--maker of Tomb Raider -- Ignore unavailable to you. Want to Upgrade?

To: Harry who wrote (1129)	7/22/1998 1:09:00 PM
From: Bleeker	Respond to of 1773

Here are the most recent Q1 EPS estimates: Volpe Brown -34 cents Andrea Williams Goldman Sachs -57 cents Jason Geller (London) DKB FLAT Daniel Kerden (London) Michael Hilton (London) First Call -34 cents Kai, I agree that EIDOS should be earnings-driven before it embarks on an acquisition hunt to add to EPS in distant quarters. I keep citing THQ as a model company but how can I not when it's trading above $34 on a trailing P/E of 16.9. Consistent earnings--including in off seasonslike Q1 and Q2--are a good thing and contribute to P/E multiple expansion EIDOS may have made a mistake by confirming that the company is on the acquisition hunt. I mean there will be many companies in this sector that will go belly up in the next two years. Why not wait until these companies go on sale instead of paying a premium to buy a lumbering and expensive company like Psygnosis. Why blow away your cash, dilute EPS and damage your balance sheet just when the company has turned profitable in the past year. If there is no deal, perhaps EIDOS should come out and say s; put the rumors to rest once and for all. Otherwise you are not going to see many buyers even with a trailing P/E of 13.8 BROD too had great games and an unwieldy/costly proprietary team that gobbled up huge R&D expenses. Look what happened to that company and stock. Bleeker