<< sorry for asking again, but I think you missed my first question to you... Were you around last
april or so to see Coms bounce from 24 to 45 in about 4-6 weeks ??? >>
Yes, I was around.
<< THAT time, it was the FEAR of INTEL. >>
Yes it was. That was a big part of it.
<< What we found that happened was that Coms GAINED market share, Intel LOST market share over the next quarter. >>
While it is true that the latest figures show COMS still has the market lead in external NIC's, Intel has already overtaken them in the embedded market. Furthermore the price cuts in Feb didn't hurt INTC, they DID hurt COMS. COMS missed their numbers because they had to match Intel's prices.
<< MY OPINION is that threat was real... the market took Coms from 80 to the 30's in no time... >>
FACT---the threat has re-emerged.
<< This time, instead of Intel breaking wind over nothing, we are faced with modem inventory and the threat of the modems not selling well... >>
I think you are underestimating the issues COMS is facing. Not only are there inventory problems with modems, but with NIC's too.
MARGIN PRESSURES are mounting for remote access products. Prices are falling fast. Just look at what Ascend and Cisco recently said about pricing. Do you actually think USRX is immune to these severe price cuts? Not only does USRX have to fend off Cisco and Ascend but now they have to worry about Lucent due to the Livingston acquisition. USRX is going to be a drag for several more quarters.
As to competition with INTC regarding adapter cards, you believe what you want to believe. The simple fact is INTC is breathing down COMS neck again. COMS is at INTC's mercy. Why would you want to invest in a company that has little control over it's own destiny? All Intel has to do is wave it's hand and COMS will be beaten down. To make matters worse CPQ says it plans on taking market share from COMS. It seems like lately CPQ has been successful at accomplishing what it has set out to do.
So what do we have here? Two $50 billion companies (CSCO/CPQ) and $150 billion INTC attacking COMS from all sides. Don't forget that BAY has risen from the grave with renewed ferver so that will make matters worse. The 3Q Dell Oro numbers show COMS taking share from ASND but that is old news. COMS shot it's wad. Now Ascend has shipped more K56Flex ports than COMS has x2. The early lead has evaporated.
All that is needed to finish off COMS is for INTC or LU to really get serious about networking.
That will be the final nail in COMS coffin...
P.S. That piece written by thestreet.com today made me feel even better. Quotes like the ones below only reinforce the notion that there are plenty of COMS bulls left out there. If everybody was bearish and we were at 35 I would cover. Unfortunately for you longs there are still gobbs of people that haven't given up on this company. They have yet to capitulate and sell out. THAT'S when I'll be buying COMS. When everyone has left them for dead like Ascend.
Significantly, the Street has not tempered its positive ratings on
3Com. Since August the First Call consensus rating on 3Com
has remained 1.8 or 1.7 -- mildly bullish compared with the 2.2
average for all stocks. (The rating system spans from 1, strong
buy, to 5, sell.) Now it sits at 1.8. "They still like the stock,
obviously," says First Call research director Chuck Hill. |
