---------------------- Forwarded by Scott Neal/HOU/ECT on 04/25/2001 08:48 AM ---------------------------

"scott neal" <sneal12@mindspring.com< on 04/24/2001 09:10:17 PM
To: <Scott.Neal@enron.com<
cc:
Subject:

Legends of the fall
from Forbes Global 04.30.01More downside

Throw in a generous assumption for future earnings growth, apply a price/earnings multiple and discount the resulting hypothetical stock price back to today, In this light the popular tech stocks are still no bargain.

---------10/31/99---------
Company price P/E 4/5/01 price Present value of discounted future earnings; 15% from 11/99
[IMAGE]
Ebay $67.57 1,930 $34.81 $4.75
RealNetworks 54.85 1,219 7.72 5.31
Yahoo 89.53 1,194 15.25 10.18
DoubleClick 70.00 933 11.81 6.70
Priceline 60.25 603 2.84 8.92
Amazon 70.63 353 9.12 17.87
Lycos 53.38 334 20.36 18.87
Qwest 36.00 327 32.85 13.00
Mindspring 25.69 257 11.38 11.80
E-Trade 23.81 238 6.45 10.27
Average decline November 1999 to present is 68.2%. Earnings assumed to grow at 50% for the first 3 years, 25% for the next 5 years, 20% for the next 6 years, 15% for another 7 years, and 7.5% thereafter. The 15% discount rate includes 5.9% on long government bonds plus a 9.1% risk premium. Source:Dremen Value Management.