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As a follow-up, here are the inputs I used (excuse the false precision on some of the numbers, but I use web queries to pull the numbers directly off Yahoo and MSN, which are then fed directly into the calculation):

EPS: $0.93
Analyst growth:
Years 1-5: 14.3% / 10.7% / 7.14% (High/Medium/Low)
Years 6-10: 7.14% / 5.35% / 3.57% (High/Medium/Low)
Terminal growth: 3%

Here is how it plays out (copied from Excel):

Ticker Symbol: SNDK
Company name: SanDisk Corp

Current Price $23.00
Expected five year growth 14.3% (per Yahoo)
Book Value 5,008,400 in thousands (per MSN)
TTM EPS 0.93 (diluted EPS per MSN)
Shares Outstanding: 224,261 in thousands (per MSN)
Discount Rate 10.0%
Book Value/Share $22.33

Results (with 10% discount rate)

Present Weight Weighted
Value Factor Value
---------------------------------------------------------
High Intrinsic Value: $24.94 25% $6.24
Mid Intrinsic Value: $20.35 35% $7.12
Low Intrinsic Value: $16.58 40% $6.63
---------------------------------------------------------
Total weighted intrinsic value: $19.99
Book Value/Share: + $22.33
---------------------------------------------------------
Weighted Intrinsic Value + BV: = $42.32

Intrinsic Value $42.32
Price to Intrinsic Value (PIV) 54%
Expected Return (ER) 84%


The spreadsheet calculates a present value for future EPS for high growth, medium growth and low growth, then weights them at 25%, 35% and 40% respectively. We then add BV/share back in.

What are we missing, or what are you doing differently? Any insight will be appreciated.

Thanks again,
Paul
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