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Technology Stocks : Seagate Technology

STX 275.39

-1.7%

Dec 31 4:00 PM EST

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To: still learning who wrote (3980)	11/1/1997 6:36:00 PM
From: Z Analyzer	Read Replies (2) of 7841

<<They are intent in boosting shareholder value - one direct way is to beef up their software division, which has grown 53% annually for the past couple of years - >> Several questions. Is SEG really growing software internally by 53% or is this growth thru acquisition which is not really growth at all. Does your wife increase your household wealth when she goes on a shopping spree with your Visa card? Aquisition is nothing like having internal growth such as that generated by DLT. Second, SEG keeps acquiring software companies, writing off all past R & D (investment) as one time charges and then reaping the immediate revenues that past R & D generates. An accounting sleight of hand that analysts conveniently overlook. Third SEG had a goal of growing software to $1 billion. They don't need the cash so why would they sell a portion of this fledgling gold mine to the public, if in fact it really is a fledgling gold mine.

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