CGRM Centigram Message Board

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Technology Stocks : CGRM Centigram

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To: Young H. Noh who wrote (260)	5/8/1998 7:11:00 PM
From: David R	Read Replies (1) of 333

CGRM now only competes against SP providers (OCTEL Sierra, Comverse/Boston Tech, etc.). I believe that they are positioned well against these companies in terms of price/features. The Octel Sierra is not a contender at all. CGRM's biggest problem is that they have been unable to make profit in the CPE side of business. The margins are too small. Now that they are free of that burden (albeit at what seems to be a give-away price) they should have much improved bottom line. I would expect that they will give a CPE vs. SP breakdown of this Q's results (due soon). That will be used to set analysts expectations for the next few. Revenues will be down, but 1-2 quarters with margins and earnings up should make a big difference in share price. Of course a couple more loser Q's and CGRM is toast. If that happens, I would expect the rest of the company to be sold. Hang on guys. I think we will be able to get out of this with a solid overall return, even if we did miss a few excellent sell opportunities. I have my avg down to about 10.5, so I will be very happy if I can sell at >= 25 in 3-6 months. Even 18-20 will be a decent 2 year return.

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