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Technology Stocks : All About Sun Microsystems

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To: Gregory who wrote (36809)10/19/2000 1:13:39 AM
From: Haim R. Branisteanu  Read Replies (2) of 64865
 
Gregory kindly make your own investment decision. but this was printed in the NY Times

But industry analysts, and evidently some investors, found
reason to be wary of the drop in the company's gross
margins, which are calculated by subtracting the costs of
production from revenue. In the most recent quarter, gross
margins were 48.2 percent, down from 51.9 percent in the
year-earlier period.



SUNW profit margin were apx. 12% last quarter based on this report they are shrinking by 3.7% or a drop of 30% in profit margin for the same amount of sales, not a positive sign for a company with a 3 digit P/E.

To maintain same profit growth YoY SUNW sales must grow 240% YoY which is unachievable as present SUNW YoY revenue growth of 47%.(remember to remove the extra week which was counted in Oct1 v. Sept 26 last year).

Haim
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