Year-on-year growth for 2000 is 100%. Admittedly, growth for 2001 is forecast to be 20-30%, but when calculating forward PEGs (which is what you are doing by equating price to growth), you need to take into account at least two years' worth of forecasts.
Anyway, here is how I look at it (Note -- I am going to use $0.70 for 2000 and $1.00 for 2001 in these calculations. These are both lower than the consensus estimates now.):
Year 2000 Earnings: $0.70 (100% YoY) Year 2001 Earnings: $1.00 (42% YoY)<-- Although TFS says 20-30%.
Current P/E based on Y2000 earnings: 46 Current P/E based on Y2001 earnings: 32
I also think that (as AZREMAN has insistantly pointed out) the LCoS business has been ignored. I can understand discounted, but I think that the analysts have completely ignored it, which does neither them nor us any favors. If it takes off as expected after the Comdex debut of the TFS-driven Samsung HDTV, then LCoS could easily add $0.10 to earnings in 2001, bringing growth up to 57% and the forward P/E down to 29. (Also, a successful debut may also lead to an IPO by Inviso, which is 20% owned by TFS.)
The other factor I think that people are ignoring is that TFS has said that sales will double over the next 12 months based on new design wins. If that truly happens, there is no way that TFS will earn only $1.00 in 2001. Every single new device made would have to be at a 50% lower profit in order for this to happen, and while TFS has said that they were aggressive about getting new low-end display designs, certainly not 100% of their new wins were of this nature -- the PDA designs, for example, should have among the highest ASPs of any product that TFS has sold. In any case, top-line growth will be phenomenal.
I dunno -- we are all allowed our own interpretations, but I see no way that TFS will not be at $40 soon and $50 by year-end -- I'd say $60, but I want to see what happens this quarter. If they get any coverage at all during Comdex, that alone (in this brave new internet-investing world) should be good for a few points. As far as I am concerned, I've voted with an additional 6700 shares bought since the earnings report came out. That's more than double what I have ever put into a single stock before. I'll redistribute some of that between $40-$45 (hopefully!), but I plan on keeping the majority for at least 6 months or until I get a feeling for what LCoS is going to do.
I think it is a waste of time reponding to flakes like j971 but you did provide good rationale although I disagree with your numbers. But what's new we always tend to disagree<G>. For what it is worth this is the way I see it.
Let's start with passive matrix stuff. The company has already mentioned all the new design wins in Cell and other hand helds. They indicated that this could be as much as $100 to $200 mill in new business. We know that MOt is gaining market share ( probably not as good as their CC numbers but good). So MOt should at least equal this year numbers which I would guess to be at least $140 mill. So now we have a passive matrix range of $240 mill to $340 mill. Lets guess $290 mill. Lets assume further a 20% gross margin with a 12.4% operating expenses load and a 33% income tax rate. Peeling thru the numbers we come out at $34 mill after taxes. Say 24 mill shares and we have approx. $1.40 per share.
Now lets add some stuff we are getting free*****Micros. Say that we are more aggressive than the companies $15mill 2001 number but still conservative at $30 mill. I say conservative because of the following facts. Their partner INFS with it's acquisition of Proxima has at least 70% of the market for A/V projectors. This market according to some researchers will reach 900,000 units next year. That means INFS share equals 630,000. Now if TFS could get 10% of this business and NOTHING ELSE. No Samsung no Nikkon no nothing. They would have sales alone of about $31 mill if one assumes $500 per unit. If you do all the math this comes to another $.50 per share.
So you see eutani my "conservative" numbers come to about $1.90 per share. All though all my numbers are very hypothetical I betcha I'm closer than you. I betcha, betcha ,betcha.
Note I am not responding to that dork. I have no idea what the stock price will be or should be. All I say is that the projected growth he spouted has no basis in fact. Und ve vill be richtig or ve take zee hostages. Vehrstan sie?
Calvin DISCLAIMER: Note I could be full of schisen and be very unrichtig.