COMS & the Ghost of USRX w/ other STUFF Message Board

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Technology Stocks : COMS & the Ghost of USRX w/ other STUFF

COMS 0.00130

-67.5%

Nov 7 11:47 AM EST

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To: David Lawrence who wrote (5345)	9/17/1997 9:37:00 PM
From: Fred Fahmy	of 22053

David, I think COMS has been hit harder than most networkers (excluding ASND) soley because they are one month closer to announcing earnings and people are nervous. I don't expect much this quarter, probably a small shortfall. Hopefully, this has already been built into the current price. Regardless of the reported earnings (unless they are a complete disaster; very unlikely) I think COMS will start moving back up after we get earnings out of the way. For me this is a no lose situation. If COMS suddenly turns north great. If it continues to drift down I will increase my position. If it drifts down far enough I will increase my position significantly. I thought about rounding out my odd lot left over from the USRX x 1.75 conversion when COMS was in the 50's, but I have been patiently waiting for an opportunity such as this. COMS is now trading at a forward looking P/E in the high teens. Even if the 1998 estimates are overstated slightly (something I think is unlikely), the forward looking P/E at worse case would be in the very low 20's. Either way high teens or low 20's are both significantly below their anticipated growth rate. Fundamentally, I am not worried. COMS is currently one of the best bargains around and any further drop makes it just that much more attractive, especially if you are thinking long term. As this industry continues to mature, I think it is becoming fairly apparent that CSCO and COMS are going to be the two dominant forces (even more than they are now) and clearly at this point COMS is significantly undervalued relative to CSCO (BTW, I am long both but). This industry has a lot of growth potential going forward, especially as the infrastructures of the non-US geographies play catch up and global participation on the internet increases. CSCO and COMS are definitely going to get more than their fair share of this ever growing pie. Seeing COMS get beaten down over concerns of a possible few cents miss in one quarter is a stark reminder of just how irrational WS can be in the short term. Good luck to all, FF

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