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Technology Stocks : Foundry Networks, Inc. FDRY

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To: jmanvegas who wrote (603)	12/12/1999 10:44:00 PM
From: Techplayer	Read Replies (2) of 1225

jmanvegas, re: "LU paid about $22B for ASND last year and that was for older technology that is being replaced", the deal was originally in the 17-18 billion range, rising to the low 20's by the time it was closed as LU share price rose. ASND's technology is neither old or being replaced. The old CSCC division alone is doubling up on orders for the year. The access division is number one in the market and gaining share. Total revenue is expected to be in the 2.5 billion range in 2000 (up form 1.5 this year) for the acquired technology and products. That puts the deal in the 12-20X revenue area for market leading products. Valuations on JNPR, SCMR and FDRY are ridiculous at these levels. None of these should command market caps of 25-30 billion for many years in a sane market, but will perhaps get there if people foolishly throw their money at it thinking that paying 25-60 times revenues 2 years from now is fair. Good luck, Brian

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