Michael,
Thanks for posting the reports. I am in substantial agreement with them, even their targets: the target I set for the combined entity after they announced the tracking stock was 35-55, with the possibility of going higher depending on how the SDLT transition goes. Of course, that cuts both ways, and if the transition goes badly for some reason, then 35 could be optimistic. But, given DLT's track record of success so far, given their pending acquisition of MDCD and their move into the booming SAN/appliance markets, and given the years of development it takes to develop a successful tape system, I think they have to be given the benefit of the doubt. And the market will give them that, too. EXBT has already allowed Mammouth II slip into the fall, and Seagate barely mentions LTO.
I remain cautiously optimistic longer term. However, I also think it is plausible that they, along with WDC and MXTR, will report less than they expected just a few weeks ago. During the Seagate CC, one analyst asked about especially crazy pricing during the week of June 19. Someone was obviously dumping big time, getting rid of inventory for whatever they could get. This probably affected everyone. I'm not really sure if it is really entirely in the stocks yet or not, though. We'll have to see.
Sam |
