Novell (NOVL) dirt cheap, good buy? Message Board

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Technology Stocks : Novell (NOVL) dirt cheap, good buy?

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To: Serendipity who wrote (19838)	1/27/1998 5:16:00 PM
From: Don Earl	Read Replies (3) of 42771

Hi Serendipity, Breaking support on volume and closing on the low looks bad. You have to go back to last summer to find a support level in the low to mid 6s. Moving averages are all down for any length of time you want to look at out to 3 years. Buy and hold is not a good way to play an issue that is trending down, but if you like to trade you can usually sneek in for a quick bite on the bounces. NOVL has a tendency to go down in up markets. When everything else on the screen is showing fat increases, trying to milk NOVL for 1/4-3/8 doesn't look like as much fun. It's when the rest of the market gets ugly that it starts looking like a good place to park some money for short term trades. Making 20-40 cents on 10K shares for a few days work in a down market isn't bad at all. It also tends to go up when the rest of the market gets over bought and over priced. I think we're seeing some short covering balancing out panic selling. I see that Novell has released the second beta for NetWare 5 and are still projecting mid 98 for final shipment. It also looks like they have addressed some of the complaints about the beta 1. Should start seeing the next batch of hopeful investors that are in love with the installed base and billion in cash any time now. At least Novell is going heads up against Microsoft for a change. They may not win but it's nice to see that there is some fight left in them. If they ever get their heads out of that dark, dark place and start spending the money on marketing, that they should have been spending all along, they might even stand a chance of winning. 10-15% of sales is what they should be spending. That's normal maintainance on a healthy business. It would hurt earnings for 1-2 quarters but within 6 months revenue would be way up, even without any new product releases. Microsoft is real vulnerable right now if Novell were to launch a carefully thought out and well executed ad campaigne. The small business section is dead without saturation marketing. Microsoft already has brand recognition, the only way Novell can get it is to pay for it. I'm starting to think about a long position for a short term trade but it still looks too early to me. Gotta wait 'till the plannets line up just right. Regards, Don

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