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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (2073)	5/21/1999 12:04:00 AM
From: Uncle Frank	Respond to of 54805

>>The pro forma run-rate is $4.80 yet the FY2000 estimates are still half that. That wouldn't be because of the split, would it? Frank

To: Mike Buckley who wrote (2073)	5/21/1999 3:56:00 AM
From: LindyBill	Read Replies (1) \| Respond to of 54805

Thanks, Mike. If I read you right, the peg, any way you figure it, is still way low for the company, and below the industry. If so, this reinforces our position on Q right now.

To: Mike Buckley who wrote (2073)	5/21/1999 4:26:00 AM
From: Tlac	Read Replies (1) \| Respond to of 54805

What else did you expect from a valuation junkie? I'm a valuation junkie, too! Mike, As you know, the P/E figure is meaningful only in that it reflects the market's judgement of real earnings. Not only are the current earnings (@ the run rate) of this company not being fully appreciated by the analysts, but also, the inevitable growth rate of CDMA has been completely miss-understood by them. The PEG is meaningless unless you know exactly how it is calculated. The estimated growth in the ratio varies from PEG to PEG as does the PE. These valuation measures, IMO, really are valid if calculated correctly. Using a revenue growth rate of 35%, and a current earnings growth rate of ~55% (which gets us from the current run rate in earnings of $1.20/sh to ~$1.86/sh), and even assuming an abruptly attenuated revenue growth rate to 35%/yr... and assuming a PEG ratio expansion from the current .77 to only one of 1.91 (in five years), one concludes that the share price is likely to reach at least $2.15 within two years. Kelly