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Technology Stocks : QUANTUM -- Ignore unavailable to you. Want to Upgrade?

To: Will Cunningham who wrote (9005)	6/23/1999 10:47:00 AM
From: Robert Douglas	Read Replies (2) \| Respond to of 9124

Let me give you the details on the Bear Stearns change: <<Following an analysis of QNTM's proxy statement and discussions with management, we reiterate our Buy and raise our price target from $25-$40 to $34-$52 on QNTM. This is based on a higher valuation for QDSS (DLT and storage systems) based on new information/increased optimism re. growth opportunities, margins and earnings visibility. Our new price target is also based on a lower valuation for QHDD (disk drive business) reflecting a more conservative valuation in view of industry dynamics (intense competition, pricing pressure, lack of visibility, etc.). We believe QDSS could be worth $27-$36, or 15x-20x 2001E of $1.80. (we previously used 12x to 14x). We believe QHDD could be worth $7-$16, based on a price/sales ratio of 35% to 80% (we previously used 50% to 100%). We see QNTM as a near-term opportunity as the proposed tracking stock will likely be approved at its 7/23 shareholder meeting. Furthermore, we think that our multiple for QDSS could be conservative due to the high growth and high margin nature of the business. (QNTM met with analysts yesterday, previewing its road show. There was no new information on the outlook for Q1, which was pre-announced on 6/3)>> -Robert