Phreakonomist

LivePerson by the Numbers: Valuation Not Compelling

In what magical financial world does a company without growth command a P/E multiple of 15?

Microsoft Assesses Its Options – But What About the Core?

The obvious disconnect is the assumption of flat margins. The article acknowledges a change in business model but apparently makes no attempt to understand how margins will be impacted. I believe that MSFT will eventually move to a subscription based model which may allow for higher gross margins but the upgrade cycle on subscriptions is much faster than packaged software which would necessitate higher opex. I agree that MSFT needs to look beyond online ads to possibly a network centric OS.

EMC Corporation: Undervalued and Ripe for Buyout

Why does every SOTP valuation assume that VMWare is correctly valued? It would be safer to assume that VMWare is outrageously overvalued based on unrealistically long high growth assumptions and EMC is reasonably valued. That being said, I am still long EMC with an eye towards hardware and kernel level virtualization technologies.