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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 270.16

+7.9%

3:59 PM EST

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To: Stitch who wrote (2450)	2/12/1998 6:06:00 AM
From: Z Analyzer	Read Replies (3) of 9256

Finally pulled the plug on a big Quantum position, alot going back to '94 and '95 after talking with two of the more influential industry analysts. Points which swayed me: -No sign of any restraint by the Koreans, Fujitsu or IBM -No substantial improvement in pricing or inventories. -IBM to double sales into distribution (I don't know what the current base is). -Fujitsu gunning after QNTM as number 3 high end supplier while -Quantum's entire generation of new high end expected to continue losses at nearly current horrendous levels until next generation hits. -May become more difficult technologically to compete in high end against IBM-like notebooks. -QNTM next gen Fireball at 2.5GB/platter vs MXTR at 2,8 and IBM at 3.2. IBM to have 4 GB by year end. -Maxtor now supposedly biggest seller to Compaq and Dell? -one belived QNTM's production restraint might not be entirely voluntary, which stuck me as inconceivable but didn't pursue. -one concurred with me that 100 GB DLT seems to have slipped in timing. Company now saying mid-99. Had been end 88 cal. -Concerned that with seven mid-range tape products slated for roughly same time, success by even one could impact dlt. SEG,IBM, HP alliance and Exabyte all targeting faster transfer rares than next DLT (15 and 12 MB/sec respectively). Does agree that difficult to bring the se products out on time and talk intended to take some steam out of DLT. Other comments- -WDC high end profitable due to lack of current competition, but is not a low cost product. -In past cycles, these stocks have sold down to book value ($6 for WDC). At any rate, now that I'm out , stock will undoubtable rise.

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