I don't really agree with you. As I understand from COMS's conference call and had a chat with a employee with COMS. COMS faced the problems for competetion with INTC for PC adaptor cards. And currently corporations is in the middle of deciding which networking system is good for them cause the pause of ordering.
To my understanding of COMS, adaptor cards in PC is really COMS's core products, so that in the short run, COMS may still have problems. But you understand that networking in not only rely on adaptor cards. Please check exchange2000.com
then you may have better idea what's kind of networking is good for current market. CS has P/E of 16 based on current price of 28 1/2 and P/E will be 13 based on 97's estimate. Do you think this is untouchable? I call this is a bargain. Mr. Benson, CEO of Cabletron said in the interview, their business is very good. One thing we can prove it is to see its earning Monday(tomorrow) March24, 1997 before market opening. What I want to point out is that, a lot of corporations just upgrade their computer systems. That does not mean they have their networking systems installed. I remember corporations started to upgrade their computer systems back in 1996 and still had a lot of ordering going on. All those computer systems will almost need networking equipment to go along with them. How can computer system still in demand and networking industries under pressure? To my understanding, networking business demand usually right after computer demands. So that we can see the demand for the networking system is coming but not really slowing.
So if smart people who want to take advantage of this low price, should start right now, otherwise you may be too late after price shoot north. Certainly, it is also depends on which company that you pick. At this time, I probably will not pick COMS at this time because of its low end adaptor card competetion with INTC, but I definitely will buy CS, and maybe pick some CSCO if it drop more. |
