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Technology Stocks : All About Sun Microsystems
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To: uu who wrote (5826)11/28/1997 3:26:00 AM
From: Holger Johannsen  Read Replies (3) of 64865
 
Addi,

thanks for your lengthy answer. I do share your optimism about the situation in Asia and feel that most of it was overblown by the media.

Nevertheless I have two remarks about your comments:

Their immediate need is to shift from a mainframe computing model to a client-server architecture. IBM and Sun (and to some extend HP) are in an excellent position (and perhaps the only companies that can) take advantage of this situation.

I'm long on Sun and I do admire their technological leadership and vision but I still feel that both, Wintel and Sun, will be able to coexist. I'm long on Compaq as well and I don't see any argument why Sun and IBM should be the only companies that can take advantage of the current situation in Asia. What is the distinct advantage of those two companies?

A few days ago Citicorp bought the 4th largest bank in Tailand.....

This argument has been made by James Cramer on CNBC as well. He feels that Citicorp will benefit from the current situation and will be the leading bank in Asia in the coming years. I'm not so sure about this. Remember the S&L crisis in the US? Did foreign banks invade the US and do they now dominate the US market today? No. But this was the time when you could have bought CCI for 10 bucks.
Now you have a crisis in Asia and I think it is time to pick up some of the local banks instead. Bank of Tokyo-Mitsubishi, Thai Farmers Bank and especially State Bank of India do look very cheap. All three are the leading banks in their country and trade at an all time p/e low. There is certainly more risk attached to them than to CCI but I think it's worth it.
BTW, the most agressive approach in the banking industry is probably done by GE Capital. They are already one of the largest banks in Europe.

Holger
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