Why is this stock so richly valued by the market. Sales are only estimated to grow 18% next year and EPS even less at about 5%. Yet, this stock's market value is almost 10 times anuual revenue. This kind of valuation is in the statosphere. Unless I am missing something, this stock should be selling in the mid-20's. I am looking to go short on this one.
I agree that mid-20's is most likely. Company can not sustain recent rapid growth and is talking about increasing R&D and other operating expenses. EPS growth will be under pressure for some time to come. Listen to recent conference call and presentation to analysts and it is clear that the company remains solid, but its earnings growth are under pressure.