Dialogic ready to soar, funds buying Message Board

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Technology Stocks : Dialogic ready to soar, funds buying

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To: Jay M. Harris who wrote (414)	8/19/1997 6:21:00 PM
From: Jay M. Harris	of 674

DLGC had a strong move with the market today. This seems like an appropriate time to revisit the issue of a 12 month forward price target. I'm going through this exersise for several reasons. #1) To the best of my knowledge this board has provided some of the very best research available on many applications of voice over data networks. I do not believe we are rookies. I'm still paranoid,however, I do believe we have a better handle on many voice issues as they relate to the associated risk/reward inherent in investing in DLGC. Consequently, I have copied recent valuation work from a previous post as follows: "However, $1.75 cal 98 eps devided by lets say $1.30 cal 97 eps = a 34% YOY eps growth rate. Now if the $1.30 97 & the $1.75 98 numbers are achieved (I think they will) then applying a P/E ratio of 30X (for 34% YOY eps growth) would yield a new 12 month price target of $52. for appreciation potential of 40% above the current price of $37. Well why don't I up my 12 month target you might ask?" Answer: I Just Did. This is because we are only 2 points away from the prior price target of $43. The purpose of this board is to provide value. I am concerned that some newbie CTI/wouldbe profit takers may act on my prior valuation work and take capital gains prior to what I believe will be an incredible market opportunity in CTI over the next several years. #2) Many on this board have experienced first hand, that certain news can reach the street "whisper numbers" prior to being made public. After all, the market can be efficient on the upside as well as the down side. Consequently, because this is DLGC's seasonally strong quarter, and Tom Amato is on board, I believe the recent run-up is discounting rapidly improving fundamentals at DLGC. #3) All primary and secondary research that I'm familiar with supports momentum entering CTI during calendar 1998. The stock market is the best leading indicator known to man kind. Consequently, the $52 12 month target seems very doable given the poor liquidity in this issue and the anticipatory nature of the stock market. This number is for real, and should be used by the board for long term capital appreciation potential. Happy Investing, Jay

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