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Technology Stocks : All About Sun Microsystems

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To: Charles Tutt who wrote (38416)	11/30/2000 9:25:23 AM
From: A.L. Reagan	Read Replies (2) of 64865

Charles & JDN: Glad we are thinking about growth rates in a 12-24 month timeframe, which is likely how the stock is being priced. JDN, can you explain, since as far as I know SUNW doesn't have a lot of excess capacity, or major overhead blubber to trim, why the bottom line wouldn't track or possibly be below revenue growth? One of the things slower growth tends to beget is pricing pressure. Charles, I'm not sure that the beneficient factors of recent years that allowed that 38.5% growth (low interest rates, low energy costs, low inflation, huge capital flows into internet build-up) will continue. All the signs point the other way. Plus the immutable law of large numbers. SUNW is a great company and s/b in anybody's core tech holdings. I've been happy with it in the past, and all I'm saying is that likely there will be an opportunity to buy again in the 60's... most likely low 60's, when the price versus risk-adjusted PV of likely future earnings are more in equilibrium.

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