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Technology Stocks : Cabletron Systems (CS: NYSE) -- Ignore unavailable to you. Want to Upgrade?

To: MaryinRed who wrote (6474)	7/9/1999 1:38:00 AM
From: Dolfan	Read Replies (1) \| Respond to of 8358

It's possible we could have a bidding war going on? What do you all think. So far I have heard...Inteel, Compaq, Nortel, Siemens, Ericsson, and I imagine Nokia may want a piece as well. Should be interesting. Mark

To: MaryinRed who wrote (6474)	7/9/1999 2:19:00 AM
From: nick cash	Respond to of 8358

if cpq we're @ $60-70/ share i would agree with you. as it stands though, cpq is in serious turmoil right now. mgmt's marching orders are to right their core business and find an answer to the dell/gateway direct model. taking on a large acquisition outside of the core pc area would be a major distraction to the task at hand. imo, such a move would be greeted with a collective, 'you have got to be kidding me' from shareholders of cpq. beyond that, cpq's currency (it's stock) is valued too low right now. as such, an acquisition would be twice as dilutive as if the stock were @ $50. finally, cs is largely viewed as a disaster in their own right. bottom line: cpq mgmt would be crucified if they even entertained such an acquisition @ this time- and they know it.... that out of the way..... i do believe that cs is not long for this world and that the company is undervalued. imo a buyout @ $20 would be too low if it included spectrum. the journalists and some analysts are finally starting to do the math that i did months ago when i took my initial position in cs (i doubled down during the decline). cs has the #1 position in the fast emerging layer 3 switching market; they have a large, mostly loyal installed base and they have spectrum. there are npure play layer 3 switching companies with minimal installed base and lower sales than cs's layer 3 revenues who have market caps higher than all of cs- and they don't have spectrum!! by these measures as well as cs's p/s ratio etc, the stock is undervalued. the major obstacle is now gone (craig), and i can't imagine cs remaining independent. i never buy stocks for takeover potential, but that is what i believe will be the fate of this holding. btw, did you notice the wording of the spectrum press release today? read like spectrum was a separate company- clearly by design. to disclose, i am obviously long cs in my client accounts (duh). and, of course, all imo only....nick

To: MaryinRed who wrote (6474)	7/9/1999 6:00:00 AM
From: kathyh	Read Replies (1) \| Respond to of 8358

hi mary... here is the full text of the businessweek cs article... very long here too!! kathy :) businessweek.com Big Cabletron Buzz The low-priced stock of Cabletron Systems (CS) is finally getting attention on the Street: It's up 49% so far this year, to 12 1/2. In early June, it hit nearly 17--a 52-week high. Two things are behind the new awareness of Cabletron, a provider of intelligent hubs and switching products for networking and Ethernet systems. Some players note that the sum of Cabletron's parts is greater than the current price. More tantalizing: Takeover buzz is running high. There have been takeover rumors before. But this time, a global telecom giant is considering buying Cabletron, say several pros who claim to be in the know. ''There are several potential buyers'' intently looking at Cabletron, says Jim Marquez, who heads Bayou Securities in Stamford, Conn. Among them: Italy's Alcatel, Germany's Siemens, and Canada's Northern Telecom, according to Marquez, who has been accumulating Cabletron shares. Analyst Chris Stix of SG Cowen, who has a buy rating on the stock, says that ''as one of the last large free-standing enterprise networking players,'' Cabletron could be attractive to a telco-equipment supplier. Based on breakup value, he says, the stock is worth at least 20 a share. Among Cabletron's assets is the Layer 3 switch business, which could be worth up to $25 a share, figures Stix. Cabletron's cash hoard totals $500 million, or $2 a share. Another division, SPECTRUM, maker of network software products, may be worth a further $3, says Stix. Cabletron says it may make SPECTRUM a stand-alone company. The betting: Cabletron will take it public. Analyst Al Tobia of Bank of America Securities, who rates Cabletron a buy, expects the company will earn 25 cents a share in calendar 1999 and 79 cents in 2000. Cabletron declined comment as a matter of policy. BY GENE G. MARCIAL