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 : The New QLogic (ANCR) -- Ignore unavailable to you. Want to Upgrade?

To: Neil S who wrote (21035)	3/7/1999 9:57:00 AM
From: Nine_USA	Read Replies (1) \| Respond to of 29386

Neil, These are positive numbers for FC switch companies. Using EMF associates assumptions: Net 1999 revenues to switch companies = 4.8b x 4% x 1/2 = 96m Net 2003 revenues to switch companies = 23.1b x 14% x 1/2 = 1.617b Net FC revenues of 96m to 1.617b in 4 years is a cagr of 103% IF ANCR get 1/3, then 2003 ANCR sales = 1.617b / 3 = 539m IF ANCR converts 10% of sales to after tax earnings and there is stock dilution of 40% from here, then 2003 ANCR eps = 539m x .10 x .60 / 25m = $1.29 A 10% after tax margin is at least plausible as EMC is 18% and SUNW is 8%. An end of year 2003 stock price for ANCR using 40 times trailing EPS of $1.29 could be conservative where revenues have been compounding at 100% for 4 years. 40 times $1.29 would project ANCR to $51.6 for DEC 2003. $5.625 going to 51.6 in 4 3/4 years is a 58.8% compound return For a stock with ANCR's history of price volatility and performance delays and disappointments, a plausible compound return of 35% is my personal threshold. A 35% return to an ANCR $51.6 price at end of year 2003, implies a current price of $12.30. I am guessing that many ANCR bulls would put the current value for ANCR pretty close to this number.