Enron Corp. - University of California | Office of The President

• Profitability of Enron Energy Services continued to escalate.
• All areas of operations are gaining momentum.
• Net income rose 30% in the quarter, and per share earnings of $0.34
increased 26%, and the outlook is for more of the same.
* * *
Summary. Everything is going well and business is really booming ....
254. On 7/25/00, Lehman Brothers issued a report on Enron. It rated Enron a "Buy" and
forecast 00, 01 and 02 EPS of $1.45, $1.65 and $1.95 and a 15% five-year EPS growth rate for
Enron. It also stated:
• Retail EBIT Up 50% Q2/Q1 As Processing Of Rapidly Escalating Contract
Base Drives Revenues. New Contracts On Schedule To Double Last Years
Level.
• Broadband Benchmark Metrics Ahead Of Schedule. Dramatic Growth In
Trading Counterparties....
• ... Better Than Expected Results. We Need To Raise Numbers: Likely
2001 $1.65, 2002 $1.95.
255. On 8/17/00, Bank America issued a report on Enron. It rated Enron a "Strong Buy,"
with a $105 price target, and forecast 00 and 01 EPS of $1.40 and $1.60 and a 15% secular EPS
growth rate for Enron. It also stated:
ENE: Outlook Increasingly Bullish; Raising Price Target
• ENE's outlook continues to be very promising ... we are raising our 12month
price objective to $105 ....
• ... ENE's core growth engine, wholesale energy operations, is expected to
grow ... 30-40% per annum for the foreseeable future ....
• ... [E]nergy services ... also continues to provide substantial earnings growth
.... The growth is remarkable with total contract values now at $20
billion....
- 211 -