Novell (NOVL) dirt cheap, good buy? Message Board

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Technology Stocks : Novell (NOVL) dirt cheap, good buy?

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To: E_K_S who wrote (5990)	12/18/1996 7:14:00 PM
From: Salah Mohamed	of 42771

Hi EKS...About Morgan Stanley Report The report is generally very positive, but the projections don't jive with the outlook. Here are my comments: ----------------------- >>FY-97 EPS $0.60<< >>5-Yr Proj Growth 9%<< These projections are very low. If they are true, we might as well get rid of the stock, it will get stuck around the current level for a long time. ----------------------- >>We view the fourth quarter as a product-transition period and look for $0.16 per share in earnings on $367 million in revenue.<< Q4 revenues and EPS are 384M and $.17, these are about 5% above MS projections. ----------------------- >>From there, management's guidance will probably be flat to up sequentially. The fundamentals haven't broken out on the upside yet, but they aren't as bad as the share price seems to imply.<< In Q4 conference call the company stated that their first priorty is to increase revenues and they indicated there will be sequential revenues and EPS growth. Should they achieve the same growth rate as Q4 over the next 2-3 quareters, I would say the fundamentals have broken out on the upside. Amen to the last statement. ----------------------- >>The company is revamping its message and marketing collateral for the low end but has backed off original plans to develop a separate product for this market.<< I don't understand this statement. Isn't Kayak scheduled for release in January 97?. I haven't heard anything to the contrary. ----------------------- Regards Salah

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