MCDT...A GREAT SWING RIDE AGAIN TODAY...they can't stop it on the LOCKED FLOAT....turning into a Cash Machine short and long! Just be Careful and Blend!
chart.yahoo.com
MCDT...200%+ growth,EMC technology & Management
LOCKED FLOAT!!TRADE BOTH WAYS EASY!!!
Company Symbol Shares Range Lead Underwriter
McData MCDT 12.5 million float; CS First Boston
Storage Area Network (SAN) fiber channel switches
McData is being carved out of EMC, the leading maker of data storage systems. It makes the high performance fiber channel switches needed to operate storage area networks (SAN). This is a large and growing industry which is being driven by the explosive growth in network data storage requirements. These demands are expected to grow from 185K terabytes in ’99 to more than 1.9 million terabytes in ’03. SAN’s are needed to manage this volume and SAN industry revenues are expected to grow at a 42% rate, increasing from $3.4 billion in ’99 to $13.8 billion in ’03.
Through its relationship with EMC, McData is on the cutting edge of this industry. Reception to it’s products has been very positive. Parent EMC consumes about 66% of its business while IBM adds another 15%. Hewlett-Packard, Hitachi, MSFT, VRTS, and Amdahl are also major customers.
This is a substantial, fast growing, and profitable firm poised on the leading edge of a large and rapidly growing industry.
The firm’s performance has been noteworthy. It is substantial, growing at a 100+% rate, and it is profitable. Growth is coming from both parent and non-parent sources. Between ‘98-’99 revenues increased by 160.7% reaching $95.3 million, with a 47.4% gross margin but a $1 million net loss. During this period, EMC accounted for 69% of the business. Between 6m’99 and 6m’00 revenues grew by 203% reaching $103.6 million, with a 51.8% gross margin and a 10.5% net margin.
Conclusion: This is an unusual opportunity to acquire a market leader in a rapidly growing industry. The firm has a combination of fundamentals and industry momentum. Because of the continued interdependence with EMC, it may also be viewed as a somewhat cheaper way of participating in EMC. |
