JDN, Sunw is headed to 62-66 on this move?!?
exchange2000.com
I am not a trader and I would like to know what you think of long term prospects of sunw. I don't want to be some one's lunch.
Flora.
From Briefing.**************************************
Two excellent earnings reports
from top companies that also compete with each other. SUNW and MSFT each beat earnings estimates by 2 cents. After the
close Thursday, SUNW reported fourth fiscal quarter (Jun) earnings of $0.73 per share, two cents ahead of expectations and up 20%
from the year ago $0.61 earnings per share as revenue rose 16%. SUNW has been held back in recent months in part because of
concerns about competition from Microsoft and concerns that Asia might cause it problems. Not so far.
Even with the recent run in
the stock, SUNW trades at a relatively low valuation. They have good management and solid, steady revenue growth. SUNW may
have further to go. Microsoft also reported earnings 2 cents ahead of expectations, with fiscal fourth quarter (Jun) coming in at $0.50,
up from the year earlier $0.40 as revenue rose 26%. Exactly what the market has understandably come to expect from MSFT -
performance. In after hours trading, MSFT was down 3/4, but it has to be remembered that the stock has surged this month and it is
normal for MSFT to beat the published estimates. MSFT did make some cautionary statements. They said earnings would be down
sequentially next quarter and revenue growth in fiscal 1999 would be less than the just concluded fiscal year for 1998. This may take
some of the air out of the stock short-term, but even with a few bumps ahead, MSFT can maintain solid earnings growth given
their market position and margins. While MSFT and SUNW reported similar numbers, valuations obviously differ. On a per share basis,
SUNW's profit exceed MSFT's, but MSFT stock is over twice the price. MSFT has a nose-bleed level price/earnings ratio, but it
deserves it. The solid earnings numbers for these two key companies will help keep a positive tone in the tech sector.
briefing.com
briefing.com
Microsoft (MSFT) --Update-- CFO says fiscal year 1999 (starting July) sales growth "highly unlikely" to be as high as just completed
1998 rate, and that fiscal first quarter revenues may be down from Q4 and that profits may fall a penny short Q4 just completed. CFO
quoted as saying MSFT is not encouraging analysts to raise earnings estimate |
