We can discuss and decide over the break.

Best,
Jeff



	"Mark Guinney" <Mark_Guinney@watsonwyatt.com>
	03/14/2001 09:35 AM
		 
		 To: "Vavrek; Carolyn (US - San Francisco)" <cvavrek@deloitte.com>, 
"vavrek@haas.berkeley.edu" <vavrek@haas.berkeley.edu>, 
"sama@haas.berkeley.edu" <sama@haas.berkeley.edu>, "jdasovic@enron.com" 
<jdasovic@enron.com>
		 cc: 
		 Subject: Re:RE: Group Project

Anil,

Questions for you:  Is Zircom in an easily definable industry so we can make
comparable studies and valuations?  Is their much public history of the firm? 
Will such an acquisition have a significant influence on Intel's earnings (my
guess is no since Zircom's latest annual revenue was only $500 million versus
Intel's $20+ billion revenue)?  Can we make reasonable future estimates of
Zircom's financial statements and business lines?

I, for one, have little knowledge or confidence in myself of analyzing a tech
company.  Given the fact that Anil is the only person in the industry from our
group we would be heavily reliant on him to give us strategic insight on the
companies and their businesses.  My preference- an industry that is relatively
more stable and simple for all of us to understand.  While we don't have to do
Amazon specifically, I would like an industry or company that won't require an
immersion of readings just to understand the product, sales distribution,
clients, distributors, etc.  Remember, we have to make guestimates about the
future of the industry and predict sales, costs, etc.  The nice thing about
Amazon (or a similar company) is that it is merely an Internet twist on an
industry with a very long history and an easy to understand business model. 
Webvan could be another example.

Another idea:  Trying to value Fidelity Investments- a private company.  The
nice thing about this exercise is that there is a lot of data on comparable
companies (T. Rowe Price, Zurich Scudder, Franklin Templeton) and some public
information on Fidelity.  A good portion of our valuation would be based on
assumptions which means that as long as we can support our assumptions we 
can't
be wrong.  

**********************************************
Mark D. Guinney, CFA
Consultant
Watson Wyatt Investment Consulting
345 California Street, Ste. 1400
San Francisco, CA  94104
(415) 733-4487 ph.
(415) 733-4190 fax


____________________Reply Separator____________________
Subject:    RE: Group Project
Author: cvavrek@deloitte.com (Vavrek; Carolyn (US - San Francisco))
Date:       03/14/2001 1:03 PM

My vote is for analyzing the Intel purchase because we have access to some
inside info, Anil is well versed in this industry (I assume) so we could do
some good comps analysis and it seems like the right size case for us.  We
could easily send Sarah the link Anil sent us and say that we are going to
analyze this acquisition.  I am also open to the Amazon analysis, although I
am not as excited about analyzing such a popular issue.

Carolyn M. Vavrek
Manager - Human Capital Advisory Services
Deloitte & Touche
50 Fremont Street
San Francisco, CA  94105

phone: 415-783-5137
fax: 415-783-8760
e-mail: cvavrek@deloitte.com


-----Original Message-----
From: Mark Guinney [mailto:Mark_Guinney@watsonwyatt.com]
Sent: Tuesday, March 13, 2001 5:11 PM
To: vavrek@haas.berkeley.edu; sama@haas.berkeley.edu; jdasovic@enron.com
Subject: Group Project


I was just brainstorming on potential projects.  I thought that an
interesting
and fairly relevant topic could be a current evaluation of Amazon.com and
how
the projected revenues & profits relate to the current stock price.  We
could
also provide some historical perspective on all realistic Amazon's stock
price
was a year or two ago relative to a discounted cash flow.  I can fairly
easily
get my hands on some Wall Street analyst research reports that could provide
us
with some insights and hints as to what Wall Street is expecting.  Most of
our
time can be spent creating a discounted cash flow model similar to what we
have
been doing in class.  Since the jury is still out on Amazon's business
model, I
think it would make for some interesting debate in class when we present our
model.

**********************************************
Mark D. Guinney, CFA
Consultant
Watson Wyatt Investment Consulting
345 California Street, Ste. 1400
San Francisco, CA  94104
(415) 733-4487 ph.
(415) 733-4190 fax


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