Replies to post #145316 on Biotech Values

[Rocky3]

Stocks are worth much more than a PE of 8 IF it is really growing* at 6-7% (long term) with 10yrT's under 2%. That is simple math.

Count me still not convinced. In addition to knowing the current interest rate, one needs to know the future interest rate and have an acceptable hurtle rate (risk adjusted return on investment). For me (even assuming a 0% current and future interest rate), an 6-7% adjusted return on investment (my time period is the next ten years) is too low. If I am trying to double my investment in 5 years, I need a ~14% return. Maybe that is too high (it surely has been for the last 10-12 years), but I was able to do higher numbers from '74-'99, and it still is the current gosl.

JMO.