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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Daniel Schuh who wrote (10187)	8/19/1998 1:09:00 PM
From: Bearded One	Read Replies (5) \| Respond to of 74651

Actually, Price/Earnings, Cash Flow, market share, # of hits per day, are all approximations. There are only three ways to make money on ownership of any financial instrument: 1) Income derived from ownership (dividends, stock buybacks) 2) Selling it to someone else 3) Putting it up as collateral for a loan (margin) Ultimately #2 and #3 are mostly derived from #1, though there is also a "prestige" syndrome sometimes. Consider: Suppose that Microsoft stated publically that it would never ever pay dividends, nor would it ever buy back its stock. What would happen to the price? So earnings and cash flow and what not are just help in guessing how much is left at the end of the day to distribute to shareholders. I don't think that Microsoft has or will ever have 300 billion dollars of distributable assets. Thus, the stock in my view is overvalued, and in the 'Mark McGuire baseball card' category.

To: Daniel Schuh who wrote (10187)	8/19/1998 2:16:00 PM
From: Reginald Middleton	Read Replies (2) \| Respond to of 74651

I am glad you posted here Dan. It gives me the oppurtunity to clarify this "Regimodel" thing you fondly refer to. <Ignore PE, just trust that proprietary Regimodel 2000 to tell you the answers.> "Proprietary" as in widely published and followed since the early 1960's (Miller, Modigliani). If you read as much as you played pundit, you would have noticed this a very long time ago. I freely offer a large pool of empirical and cirmcumstantial data to bolster my assertions. I look forward to seeing you and Mr. Gurley doing the same (actually, I enjoyed the Gurley article).