Novell (NOVL) dirt cheap, good buy? Message Board

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Technology Stocks : Novell (NOVL) dirt cheap, good buy?

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To: Joe Antol who wrote (11497)	4/23/1997 10:47:00 AM
From: E_K_S	of 42771

From Briefing.com this AM....09:30 ET ****** NOVELL INC (NOVL) 9 1/32 CLOSED. Expect these struggling shares to set a new 52-week low at the open after the network software company warned of a disappointing 2nd qtr. News comes as a kick in the back to investors who recently found the courage to reacquire the shares on hopes that former Sun Microsystems (SUNW) chief technology officer Eric Schmidt would revitalize the company after being named NOVL's chairman and chief executive on March 18. However, Schmidt obviously had little to do with what the company sees as a "slight profit" for the 2nd qtr, which appears will disappoint analysts' $0.16 a share estimate for the quarter. Saying that sales of boxed software to small and medium-sized businesses by its OEMs and distributors are lower than previously expected, the company expects to log total 2nd qtr revenues of only $300-$335 million. Though the sales figure will be much stronger than year-ago's $188 million, it will represent a sequential decline from the $375 million logged in the 1st qtr. The company's obligatory mitigating comment is that sales through its multi-product license programs remain strong, reflecting strength in the large network enterprise market. On the news the stock is indicated to open almost 2 points lower, or approximately a 20% decline from yesterday's closing price. Novell expects to report final 2nd qtr results on May 28. ===================================================================== Joe - I dodn't follow this comment. "...Though the sales figure will be much stronger than year-ago's $188 million...". Do they mean for the Intranetware products or sales to their large network enterprise market segment? Is the impact to revenue due to the small business segment shortfall only? If so, it seems clear that an agressive marketing of the Internetware for Small Business product needs to be re-thought, priced better than NT and delivered to new customers at little or no initial cost. Perhaps they can wrap this product with a annual maintenance service contract and just give the software away for free. Future updates at a minimal charge. EKS

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