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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: wolfdog2 who wrote (9942)	2/26/1999 1:33:00 AM
From: Todd D. Wiener	Read Replies (2) \| Respond to of 14266

Well, I'll climb out on a limb and stick my neck out, etc. My aggressive, yet realistic estimates for 1999 are as follows: Q199 Revenues $94 million (94% growth) EPS $0.91 (60% growth) FY99 Revenues $394 million (83% growth) EPS $3.40 (70% growth) The joint venture's contribution in 1999 will be .20 after tax. Rushware will account for about 10% of revenues. Stock price target before year-end 1999: $55 I'd like to correct a statement I made earlier. I said that I thought THQ could make over $1.50 per share from the JAKK joint venture in 2000. I was incorrect. That's pretax. The new figure is $1.00. But I still believe that THQ can make well over $4.00 in 2000. These estimates may seem very high, but my original estimates for 1998 were very close, if you look at my posts a year or so ago. Of course, THQ still beat my numbers (which I subsequently lowered, and then THQ beat them by a wider margin--20% for Q4 1998). They may seem high, but I have a year of wiggle room, a year for THQ to fulfill my estimates. Todd

To: wolfdog2 who wrote (9942)	2/26/1999 2:34:00 AM
From: Marc Newman	Respond to of 14266

The problem is that Farrell's "prognostications" are not correct. No way THQ only does $2.10 or so in 1999. So the comment about THQ not being a growth stock seems off base to me. I see very nice appreciation for THQ from here and still wouldn't be surprised to see a $40 price sometime in Q2. Your second paragraph touches on something that I too find interesting. Farrell says he's not gonna climb out on a limb, yet I think that's the problem. There's a huge difference in investors' minds between the 20% rate that Farrell is "comfortable" with and say 30% growth. As we know, many investors think that one good way to value a stock is by giving it a PE equal to growth rate. But look at the difference in share price between a 20 PE for THQ and a 30 PE. That $20 or so is the difference between a nice gain and a monster gain. I think Farrell should admit that he's going to grow by 30%, even if it means he doesn't get to surprise (embarrass?) the street every quarter. Man, just look at Q2. Last year we had low wrestling sales and a late (albeit large) release of Quest. This year we likely have at least equal wrestling, we've got Rugrats 64, we've got a surge in Rugrats PSX and the color GB release, and I believe Farrell said Sinistar. I see a big increase in year-over-year. [Edit, oops, I forgot to even include Shao Lin, the first true four-person fighter for the PSX. Think that will add even more, especially since it is shipping the first week of the quarter?] Q3 should be the same. Last year was weak, this year has Road Rash, both BASS console titles, etc. I can make a case that Q1 and Q4 won't be hard to beat too. Regards, Marc