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Technology Stocks : TLAB info? -- Ignore unavailable to you. Want to Upgrade?

To: Beltropolis Boy who wrote (5576)	5/20/1999 11:58:00 AM
From: Doughboy	Read Replies (2) \| Respond to of 7342

I don't have the data to do anything very sophisticated, but taking what you gave me, TLAB has had an average P/E of 33.32 over 5 years. They had an avg. earnings growth rate of 50%, so the historic PEG is roughly .67. Current PEG is around 1.6 (using the earnings estimate of 30% earnings growth in this year and 5 yrs forward). This suggests overvaluation. OTOH, TLAB usually outstrips estimates, so a more realistic view of earnings growth is around 40%+. Also, during the past five years there has been a huge P/E expansion in the whole industry and the S&P, so TLAB's PEG remains well below its peers (Yahoo lists an Industry PEG of greater than 5, and S&P PEG of 4.). If, however, the TLAB growth rate does fall into the 30-40% range, then inevitably the P/E has to contract. I'm comfortable with a forward P/E of 50 (which we're passing right now), but I would tend to believe that you'll see a P/E range of 30-60, which translates into a share price range of $37.5-75 in '99. Doughboy.