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Technology Stocks : All About Sun Microsystems
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To: Thomas Mercer-Hursh who wrote (23550)11/29/1999 5:08:00 PM
From: jim kelley  Read Replies (4) of 64865
 
RE:
SUNW is an inefficient manufacturer of expensive proprietary boxes


You seem to have missed the point of the post: SUNW's projected earnings do not support the price of the stock.

Inspection of SUNW's 10-Q shows that about 85% of SUNW revenues come from hardware in the form of servers and workstations.

This is not the best forum to pick apart and compare competing workstation and server architectures. It is sufficient to say that INTC is targeting the 64 bit MP server and workstation market with the Itanium chipset. This clearly is SUNW turf. So competition is not dwindling is these markets it is about to significantly increase in Y2000. The Wintel box producers are much more efficient than SUNW. A strong Itanium product offering is these market segments is likly to penetrate the SUNW customer base rapidly.

Again, the Wintel box makers are much more efficient than SUNW. If you do not believe me take a look at operating costs and production costs.

The current WINTEL server base tops out at 8 processors with the exception of some specialized machines. Itanium will allow the construction of higher end enterprise machines with more than 8 processors. These will assault the SUNW server market.

WIN2000 will be introduced in Feb and is targeting the UNIX base. Again the competition is increasing not dwindling.
So SUNW's market position is clearly targeted for a major assault in Y2000. This will continue for 2-3 years.

Hence, the stock price is not supported by the market fundamentals.

I am still hoping it will hit 150....

:)
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