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  • First of all, thanks to everyone for the info on
    the GTE plant acquisition. I agree that if this deal
    leads to addtional printing of GTE directories for DNY
    it could be a positive move.
    We shall
    see.

    With respect to PE ratios, there are different ways to
    look at them. You could look at the PE based upon the
    last four quarters or you could look at the PE based
    upon future estimated earnings. Generaly, the market
    tends to look at future estimated earnings to determine
    stock prices. DNY stock has normally sold at a price of
    about 18 times estimated earnings. If DNY earns $1.95 a
    share this year the $41.00 stock price reflects a
    future PE of 21. Since the market tends to look further
    into the future, if DNY earns $2.20 a share in 1999 a
    $41.00 stock price reflects a future PE of about 18. If
    Davis is able to keep earnings on track with analysts
    estimates, ie about 12% growth a year, you may see slow but
    steady stock price appreciation. If earnings slip or are
    not what investors expect, DNY stock will drop or
    stall and the PE will be adjusted.

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    • Obviously the P/E changed in the last few days
      when the 3rd qtr "98 number replaced the '97 number
      with a positive benefit.Also. some people will factor
      in all earnings whereas others will exclude unusual
      or nonrecurring gains/losses such as the sale of
      assets like Metromail since they cannot be sold again in
      the future. Bottom line is that one cannot go solely
      by a number without checking a little deeper into
      what the underlyingfactors are. Sometimes referred by
      some people as the quality of earnings. I guess that
      means a buck is not always a buck!Woody912

 
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