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Non-Tech : Gentex (GNTX) -- Ignore unavailable to you. Want to Upgrade?

To: Turs who wrote (129)	8/18/1998 5:50:00 PM
From: Afilarguros	Read Replies (1) \| Respond to of 196

About the price. I agree that Gentex's potential growth is worth the risk of a slowdown in the auto market, especially for investors who are willing to stay invested for the long haul through the next cycle in the auto industry. I believe it has the potential to be a multi-bagger in the years ahead. However, I don't see how the current price factors in the risk of a recession, or why it's considered discount now at all. Last I checked, both First Call and Zacks estimate FY 98 & 99 at .64 & .79. With trailing 12 months earnings at .595, that's 20.8% annualized growth from now till 12-99 [.79/.595 * 1.5sq.rt.] So I calculate the fair price to be about $12.38 [= 20.8 * .595]. I do, however, realize that 6 qtrs. ahead is only a short time to factor in growth. Does anyone know what the '00 estimates are? Anyway, am I missing something here? Back to the point about a recession, which will happen eventually. When it does, if Gentex's growth is knocked down 15%, wouldn't it's price be hit at least that much if not much more? Analysts expect 23.5% growth from 98-99. If 15% is taken off growth in that range, Gentex may continue to grow, but not much, especially if the gross and operating margins don't hold up.