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

To: Sonki who wrote (11363)	10/16/1998 11:02:00 PM
From: Boon	Respond to of 74651

MSFT never at such high valuations?? What do you mean? MSFT p/e was at 75+ trailing earnings earlier this year.

To: Sonki who wrote (11363)	10/17/1998 12:51:00 PM
From: John F. Dowd	Read Replies (2) \| Respond to of 74651

I don't trade MSFT except trying to scalp quasi dividend by selling calls. It could be that we are seeing a run up prior to earnings release here and that the price is nearing a short term peak . In any event this is the premier company of our time and I can't conceive of them not winding up in the right place at the right time. It is peculiar that there are so many comments on this board that damn MSFT for being right as often as they are and then hoping that the gov't. will dismantle this great success story. This company has a vision just as IBM had in the 50's. Unless they lose that zeal and vision this stock will see 150-170 before the end of 1999. John

To: Sonki who wrote (11363)	10/20/1998 11:44:00 AM
From: johnd	Read Replies (1) \| Respond to of 74651

Sonki, Regarding earnings forecast, I am not sure if you were asking me, JohnD or John F D. But anyways, I will assume you were asking my opinion. First off, wall street expects revenues of 3.8 to 3.85Billion with EPS of 49c mean and a range of 48 to 51c. I read somewhere that the whisper numbers are at 52c. I don't agree with wall street. I think revenues will be 4 Billion with deferred revenues of 700 million. EPS will be about 53 to 54c. Including one time gain of 6c, EPS will be 59c to 60c. Microsoft will see above expectation performacne in Japan due a) Stronger than expected windows98 upgrade sales b) Favorable currency movement. Overall, revenues and EPS also will be boosted by strong sales of NT and the larger unit sales of sub 1000s. I expect wall street analysts will be guided that December Q will be sequentially up slightly and same for Q3 and Q4. So all in all analysts will be forced to move EPS forecast upward from a mean from 2.15 to 2.20 in about 1 - 2 weeks. But for the short term fear of DOJ action, the stock should be trading at 126 or so. Even at 2.20 EPS for Fiscal year, it is trading at 46 PE for this FY. That is a PE to growth of about 1 considering last 10 year average growth. I am of the opinion that the stock is undervalued by about 20% at this point at 101, dated 10/20/98 johnd