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Technology Stocks : IFMX - Investment Discussion -- Ignore unavailable to you. Want to Upgrade?

To: RDH who wrote (11672)	8/17/1998 3:06:00 PM
From: Austin	Read Replies (1) \| Respond to of 14631

Yes..... and I think Bob F. is doing the right things by controlling costs and making the moves for Informix to make significant penetration into hot markets like E-commerce /DW. This should equate to top-line growth and increased profitability and more sex appeal for the stock (higher PE).

To: RDH who wrote (11672)	8/17/1998 3:09:00 PM
From: Charles Hughes	Read Replies (1) \| Respond to of 14631

Me: "If IFMX makes 0.20 a share this year, a miracle in other words, it will have a P/E of 28 at current prices. So, why does everyone here seem to think the market isn't giving this stock full credit?" RDH: "The key is how much a share will IFMX make 2 years later. If it is around $1.00, which is possible, than there is nothing wrong with it having a P/E of 28 at the end of this year, in fact a P/E as high as 50 would be within reason. Using this as a basis, Informix could get back up to a price of $10.00 a share by the end of the year. " Actually I think this analysis of the stock's prospects is even more scary than mine. What you are saying is that if a company that has been cost-cutting and has had other problems, that is in an industry now growing in the low double digits as a percent, were to amazingly grow its EPS at more than 100% per year for two and a half years, the reward would be a ten dollar stock, less than 50% growth in value per year for two years. Very approximately. Yeesh. And that's the upside. I've done better with bank and utility stocks. Now I have come to have the same unreasonable expectations of stock prices as everyone else, but a little voice keeps telling me there is a bit of risk here. On the plus side, I think if the miracle happened and you got that growth rate, for even 9 months from here, the stock would be well above 10 bucks, ommitting a bear market from the analysis. Cheers, Chaz