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Technology Stocks : FDC : First Data Corp

FDC 31.69

0.0%

Aug 5 5:00 PM EST

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To: Uncle Mikey who wrote (43)	3/16/1997 1:54:00 AM
From: Art Ebbands	of 323

Mike, Good to see someone else following this one on this thread. This is a great conservative company that's going to increase revenues & earnings at 20% for the next 5 years. The management in this company is the best. This is my only long term holding & I'm buying more now. Bought some at 35 1/2 & 34 1/2 just last week & have open orders to buy more @ 33 1/2, and 32 1/2 now if it falls more. I expect FDC to be at 100 withing 3-5 years. Here are some reasons why it has been weak lately. Putnam sold over 9 mil. shares completely liquidating their position. Last week National Processing which has 15% of merchant card business announced their earnings would not meet current qt. expectations due to heavy competition. The street may have interpretated this to mean FDC's merchant card business might also be affected. The true situation which I know is that FDC is taking business from them. Also Money Gram which was divested by FDC in FFM acquistion announced similar competive problems last week. What wasn't mentioned is that FDC's Western Union business acquired in FFM acquistion is now competing with Money Gram & taking away much of thier business. FDC is the leader & is cleaning clock in their core businesses. There are still some problems businesses acquired in the FFM deal that they must divest themselves of. This should happen withing the next year & should make for better sailing in the out years. Some positives: Business Week Magazine just coming out lists the top 500 companies for revenue & earnings growth. FDC is 78. Expect to see some new major announcements re: transaction processing this week. The Hong Kong deal was a biggie but the street seems to be ignoring all this. All these new big deals won't do much for earnings this year but will bode well for FDC in the out years and could portend even better than 20% earnings gains. At 44 FDC got overvalued but it is now getting into undervalued territory. Don't get impatient with this one; it's a core long term holding: my only one! Incidentally, I got into CSCO at 49 1/8 & am adding more at any price under 50. AE

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