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Shares of Amgen (AMGN) used to trade at a nice premium to the market. Not anymore.

The stock has plunged this year, and it’s on the verge of making a 21-month low today. Still, the earnings appear to be fine. The company missed Street estimates by five cents a share last quarter, but it was still a big increase over last year’s fourth-quarter.

Here’s a look at Amgen’s stock with the earnings-per-share line in gold. The two lines are scaled at 25-to-1 (when the lines cross, the P/E ratio is exactly 25).

You can really see how far the valuation has fallen. Going by the same earnings multiple of just a few years ago, the stock could easily be worth $100 today.

At the beginning of the year, Amgen said it expects earnings of $4.30 to $4.50 a share for 2007. The company recently stood by that forecast.

Posted by edelfenbein at March 15, 2007 1:41 PM