On Sep 29, 2005, at 7:26 AM, Hawaii Linux Institute wrote:
Mid of the night and finally got a chance to browse the web.
Suddenly, a news alert: Red Hat shares up 25% (thus pushing its
market cap to ~$3.5B, I believe).
It closed up almost 30%. Market cap $3.79B, but the P/E is 86.10,
which is in the "insane dot.com" range. For comparison, CSCO's P/E
is 20.58, IBM's is 15.7, NOVL's is 7.79, MSFT is 23.08
SUNW's is ... non-existent (negative earnings)
I am sure everyone remembers this: Not too long ago, Red Hat was
facing the reality of the Internet/Linux bubble and decided to
abandon their consumer/desktop versions of Linux as part of their
corporate-wide full-retrench strategy to preserve capital and thus
to hopefully survive. It was our lowly local boy Warren who
convinced Red Hat to recycle their unwanted surplusage into a
community project called Fedora.
Now both Novell and Sun are desperately trying to build their own
versions of the Fedora Success (capital "S") model. Personally, I
believe Warren can claim credits for at least 3 of the 3.5B of Red
Hat's total market capitalization, but who's count? :-) Wayne
Warren is a smart guy, but if he generated $3B of value for RHAT,
then something is wrong in Raleigh, NC.
