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Technology Stocks : Nortel Networks (NT)
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To: MrsHunt who wrote (610)8/13/1998 10:46:00 AM
From: Cruiser  Read Replies (1) of 14638
 
Ms. Hunt,

Interesting that you pick $40 for NT. At 40 that puts Bay at 24 (40*.6) which of course is roughly the support level attained prior to the buyout. I certainly dont see NT going any lower than 40, which is one big reason for me to be cheering the NT/Bay merger. Certainly NT could trade down to 40, but at those levels NT would be a screaming buy. The Price / Sales ratio currently is the lowest of the Big Three (Crisco, Loosent, and NT) ... At $40 bucks, NTs P/S ratio would be approaching 1 (on a forward sales basis). This would seem rediculously low compared to criscos 8X and Loosents 4X.

You sound like the same people who were arguing that CS and COMS were screaming buys at 40 and 80 respectively. Look at those stocks now. cabletron is going to have to return to it's roots and start selling cables to be profitable again. COMS has given up on the Enterprise (see their recent announcement on SME) so they are taken the low-margin road.

NT and Bay have *all* of the pieces from end-to-end that are required to build todays and tomorrows networks. Unless you have evidence that NT can't integrate aquisitions (which I havent seen) then I cant imagine the reason to be bearish at theselevels.

Granted we may have to wait a few years to have crisco of loosents valuations, but it is a THREE WAY RACE, and NT is currently number 2. (sorry crisco you're number 3)

Cruiser
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