Seagate Technology - Fundamentals Message Board

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Technology Stocks : Seagate Technology - Fundamentals

STX 308.19

-6.8%

3:59 PM EST

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To: Kevin Linder who wrote (1624)	4/2/2000 1:46:00 PM
From: Stu E.	Read Replies (2) of 1989

Kevin, thank you for your assessment. We all believe SEG's core DD business is a steal at $5 share. I am a longtime investor in EMC but can not buy it at its current astronomical multiple to earnings. I mention this because VRTS may have the same potential to experience super growth. If VRTS experiences a 50% plus earnings growth rate over the next 5 years, does that justify the current PE of greater than 200. Maybe it does, but I can't convince myself to buy VRTS at such a high multiple. Over the long run, I agree that VRTS is a good investment going forward. Paying the current high multiple with undervalued SEG shares, however, does not appear to be in the best interest of SEG shareholders. If the DD industry is turning up, SEG shareholders will be deprived of the benefits of the uptrend. The timing of the deal maximizes the value of VRTS while minimizing the value of SEG. I think SEG shareholders are not receiving fair value for their SEG shares. Stu

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