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Technology Stocks : Bel Fuse is now BELFA and BELFB -- Ignore unavailable to you. Want to Upgrade?

To: Ginko who wrote (30)	4/27/1999 5:31:00 PM
From: Elroy	Read Replies (1) \| Respond to of 67

Question on BELFA's PE. I'm trying to figure out what BelFuse's PE is based on 1999 earnings expectations. If we suppose the company will report ~$20 million in earnings for 1999 (Q1 x 4, just a guess), how many shares do we use in calculating the PE? The quarterly EPS reports (like today's press release) only take into account the Class A shares (~5 million), which gives you a PE of ~10x (stock ~$40/$4EPS per share). If the 5 million outstanding B shares represent 1/2 the company, then the actual earnings per share are $2.00, right? (5 million A shares + 5 million B shares). So the PE (if we view class A and B as each representing 1/2 ownership of the company) based on 1999 earnings is about 20x (share price = ~$40/$2 EPS in 1999). Right? Then, if we consider that Belfuse doesn't repatriate foreign earnings (thus the low tax rate, only about 10%) the $2 per share earnings estimate for 1999 is artificially high. If we assumed they get taxed at a more normal corporate rate (say 35%), then the 1999 EPS goes to about $1.60, and the PE goes to about 27x. Or, we can just take the numbers the company gives (only use class A shares when reporting EPS )and assume the 10% tax rate is just the result of smart use of profits by Belfuse, in which case the PE seems crazy at about 10x. Comments? Elroy