Andrew,
Why not give your analysis a few different view points?
1) I think evaluating tech stocks totally on an
accounting/Buffet way is extremely wrong. Buffet likes
to pick stocks that have been working well
(almost machine-like) for the last
20 years - so future predictability is easier.
I think with COMS, you have to believe in the
network/internet sector as part of the next major
revolutionary trend of this century, and of the 21st
century. If you don't believe this, then I don't think
you should be in techs long term - you won't have
the conviction that you'll need for the long term.
Buffet style strategy is harder to apply to tech stocks.
2) I'm not so sure about that low profit-margin argument
of yours. Look at the box-makers like DELL and CPQ (until
it had a blow-up). Successful low margin companies.
3) COMS is not just a low-margin company. Next month
they'll be coming out with their gigabit switch router.
It will be interesting to see how the market sees this
product. Plus, COMS has other higher end products that
they are consistently coming out with.
4) A lot of the problems with COMS are not COMS specific.
They are a function of the network slowdown, which in my
opinion is temporary. If you think the network sector
is doomed permanently, then sell.
5) COMS is at a bottom, so downside is not as risky.
I've owned MSFT, DELL, and CSCO, over the last year.
If these stocks go down, they've got a long ways to
go. I own these stocks on shorter terms in the last
2-3 months. I find it hard to justify holding them
long term, even though they're the cream of the crop.
Hope that helps,
Joe
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