Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Equinox Systems (EQNX) -- Ignore unavailable to you. Want to Upgrade?

To: HeyRainier who wrote (646)	11/5/1998 9:20:00 PM
From: Scott H. Davis	Read Replies (1) \| Respond to of 765

I've never thought in terms of risk premiums vs fixed (I don't think fixed) so I won't touch that question since I can't do it justice. What is a reasonible multiple - I would say 20. Based on its supurb FA, where it trades relative to its normal ranges (P/Sales, cash flow, PE) The disconnect between margins, ROA, ROA & DE vs P/book & P/Sales should close with a couple good qtrs, their products, their very good cost structure, 38% 5 year EPS growth, good % of qtrs with upward EPS surprises, Their cash & current ratio. The downside, a small company with a limited # of customers is vulnerable to one customer delaying or scaling back orders can wreak havok short term (not just EQNX, had it happen with PTIX and SBEI) If EQNX was 3-4 times bigger, it would get better multiples and smoother qtrs. Scott