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dpdoor (42.77)

Remember RIMM at $108

Recs

3

June 26, 2010 – Comments (1) | RELATED TICKERS: BBRY , SBUX

Do you remember back in Sept of 2007 when RIMM was expected to go to $108 per share?

This is from one of my first blogs back when I first joined Motley Fool ; RIMM was $90 and expected to go to $108.

I was trying to warn those (back in 2007) who were investing in Research in Motion that in 2010, using the same formula that put it at $100 per share would also put it at $52.39 in 2010.

　

dpdoor's Blog Sept 20 2007, it got only one Rec.

.......It’s price is based on its growth trajectory. If it grows at the same rate as the last year for 3 more years then flattens out, the annual eps will be $3.49 , if it’s growth comes down to the normal good business (3 years from now) then the p/e will be 15x and the share price would be $52.39, (3years at 47% growth and then 15% growth as it matures)

So you can see how the analyst get price targets from $50 to $108 (and one at $120 but they did not give any plausible reason for their estimate.) It could be worth $109 for a few months if they hit their best numbers then go to $50 (3.49 x 15) over the next few years.  [end of Sept 20 2007 blog]

NOTE IN 2010: RIMM is at 52.23. in 2007 I estimated it would be 52.39 in 2010; it should go up 16 cents.

[note for 2010; can the same can the same math applied to SBUX?]

1 Comments – Post Your Own

#1) On June 26, 2010 at 7:03 PM, dpdoor (42.77) wrote:

Half rally; the market was at 11300 it came up from 6500. 6500 was panic sell off 10300 was greed momentum. The market went to 9700, just less then half way between the two.( I had called these targets a year or more before they happened) I then called 10700 as the bounce up, a little more then half up. It hit 10627, then I called half back down to 10150 it hit and Monday I will see if I was right, the last two days were less drop then a good drop and full rebound. I think that is a bottom and it matches my target. We are one week from the end of the month and consumers seem to feel better this month but they are losing confidence from the market slide.

I think we will hit 10500 next month. After 10500 we will hold if consumers are doing great but if they pull back again the market could go to as low as 8900. A third failed rally will be very hard on the market if we don’t have great news.

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