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Technology Stocks : Silicon Graphics, Inc. (SGI)
SGI 87.31+3.2%3:59 PM EST

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To: brushwud who wrote (1625)6/17/1997 7:21:00 PM
From: Jeff Maresh   of 14451
 
Brushwud - I think you've got ROE (Return on Equity) mixed up with ROI (Return on Investment). The ROE number of 13.5% for SGI is pretty good for a high tech company in SGI's position. It's a measure of how well management has used their equity to build the business. SGI's is low right now mostly because of the Cray acquisition and reengineering and I would expect it to go up again after the new product cycle is in full swing.

Your are talking about the last 10Q? This news is already out and built into the stock price. Basically people want to buy the new stuff, not the old so they will write the old stuff down. No surprise here.

>Also, the 10-Q indicates that another $3M of overvalued inventory
>will impact gross margins this quarter.

Regards
Jeff
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