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Technology Stocks : Quantum Disk Drives (HDD)
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To: nonzeroa who wrote (135)7/27/2000 9:51:54 AM
From: Thomas DeGagne   of 179
 
Thank you for your summary of the conference call. I now understand the substantial drop in price of both HDD and MXTR. This statement says it all:

"HDD saw a SUBSTANTIAL decrease in desktop pricing at the end of the quarter and expects it to continue. Aggressive desktop price reductions combined with the enterprise component shortage cause the company to expect a FYQ2 LOSS."

Were is the bright side in the CC? If supply of Entrerprise drives is constrained at competitors as well then unit price should rise leading to higher margins. This should help all suppliers.
If supply is not constrained at competitors then they will take market share from HDD.

The under supply of desktop PCs will accumulate demand for later this year. Once CPUs are available sales will rise rapidly. Demand for drives is postponed, not lost, as there is no substitute product available.

This appears to be a buying opportunity for DD stocks.
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