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Technology Stocks : Seagate Technology - Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Z Analyzer who wrote (689)	3/18/1999 11:46:00 AM
From: LK2	Read Replies (1) \| Respond to of 1989

*OT*RE--Valuation/Price Target. I've got a bunch of home building stocks that are selling at a trailing PE of 7 to 10. The earnings on these companies have been rising for a good while, and future earnings outlook is positive. Unfortunately for me, the housing stocks have been performing miserably for several months (which is why the trailing PE is so low). So is 25 a reasonable PE for drive stocks? Sure, why not. So is a PE of 10 or 15 or 20. Remember, the market is a discounting mechanism. Except what the heck is it really discounting? When you examine the relationship between reported earnings and price, you start to realize that the correlation is extremely fluid. I would guess the correlation between projected earnings and price is even more fluid, but you would need access to a database of Wall Street projections to really check that out. Just my two cents worth (really worth about 1/10 cent). Larry PS--A question for you economists. If my two cents is worth 1/10 cent, is that discounting, or is that inflation? <G>