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Technology Stocks : Box Hill Systems

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To: don ryndak who wrote (107)	2/6/1998 8:02:00 PM
From: Clam Clam	Read Replies (1) of 113

The quick answer is: their fibre channel revenues will not ramp but revenues should gather steam and growth will be respectable. (They will continue to grow nicely but they won't be blowing out numbers). The stock is undervalued and I continue to hold my position. The stock is too cheap to sell given there aren't any outright problems at the company but I might sell some if it should go up some more just because I think I would rather own a mid-cap company with a more predictable business model for the same or better growth prospects. EMC sells at 26x 1998 estimates and BXH is at 16x. If BXH can crank out the growth, the stock will grow at least as fast as earnings (by roughly 30% per year). There is little risk to the multiple of BXH, IMO... The risk is all in the company executing. I think they will and I think the stock eventually goes to new highs. However, if they should stumble, new highs might take years and I don't have the patience. Therefore, $25 is a longer-term price target. I target $18-20 in 12 months which makes me think I would sell it in the mid-teens if it went there near-term. However, if I find something more attractive (better risk:reward profile), I might even sell it near here (my cost is b/w $13 & $14 so I may sell it somewhere b/w $12 and $15 - I have been expecting a range of $9 - $13 but we shall have to see if it can crack $13 here in the near-term).... What is your plan?

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