QUANTUM Message Board - Msg: 2844788

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Technology Stocks : QUANTUM

QNTM 8.370

+3.1%

10:09 AM EST

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To: T Bowl who wrote (5828)	12/1/1997 9:37:00 AM
From: Z Analyzer	Read Replies (1) of 9124

<<s that a real # or a guess? I've never seen anything published. I can't even come close to that using 35%GM, 36%taxes, 9% OpExp. I get $0.34 using that model>> We're within a percent on assumed operating margins. The difference is that I use Qunatum's overall tax rate of 26% and you use 36%. Which raises an interesting question. Your tax rate assumption may be better since most DLT is US produced and sold. However, since Quantum talks of DLT and desktop drives each contributing 1/2 of their profitability (I don't know whether that means operating or after tax) some have concluded that operating margins could be as high as 29% which allows room for a higher tax rate and still hits roughly my profit figure. Regardless, we know DLT profitability will increase substantially this year and your estimate assumes that they shrink which appears highly unlikely.

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