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Technology Stocks : Novell (NOVL) dirt cheap, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: DJBEINO who wrote (29374)	12/20/1999 7:44:00 PM
From: Paul Fiondella	Respond to of 42771

Here's the full SmartMoney analysis from the WSJ Stocks With Potential Aren't Always Pricey By STEVEN SWARTZ They're some of our favorite stocks, well-positioned for a wireless, online world. Broadcom. JDS Uniphase. Inktomi. They're also incredibly expensive, even if you do believe that everything is different now. Broadcom's price/earnings ratio, based on this year's earnings, is 382.8, compared with 44.1 for the average stock. Inktomi doesn't even have earnings, and JDS slid into the red on recent write-offs, but both have stock prices above $150 a share. Time to sell? Not necessarily, but it may be time to add a stock or two to your portfolio that you've bought not solely based on potential -- like all these wireless and Internet plays -- but one based on a more old-fashioned notion of value, where the stock price seems downright reasonable based on the companies' potential. Believe it or not, that's actually getting easier to do, as more and more stocks get left behind by the market's obsession with the newest technology. Again, we believe in this revolution wholeheartedly, but it doesn't mean there aren't some other good buys out there. In fact, even in tech, there are some sectors that the current rally has left behind, or left behind relative to the highest fliers Recently, SmartMoney financial editor Jersey Gilbert led a team searching for companies that had both good business potential and stocks that were reasonably priced, and we named them our Best Investments for the year 2000. Two of them that we'll focus on here are actually in the tech sector. The first is Novell, a software veteran whose stock has lately been left in the dust by the likes of Veritas Software and Juniper Networks. Still, Novell is thriving in the market of linking or networking various computer systems. Hanging over Novell is the threat of more competition from Microsoft, but the analysts we've spoken to think that's overblown. At 29 times next fiscal year's expected earnings, Novell strikes us as an unusual bargain in a very heated sector. Then there is Citrix Systems, a software leader in the Internet side of the networking universe. Citrix makes it easy for a computer user to access Internet applications from a central server as if the application were on the user's own machine, keeping systems from getting bogged down with too many applications and thus speeding everything up. Citrix has had a strong run lately, up more than $20 since it caught our eye a few weeks ago. But with a P/E ratio of 83 based on the past 12 month's earnings, its price is still relatively attractive for a company that could play a big role in the future growth of the Net. -- Steven Swartz is editor-in-chief of SmartMoney magazine. Contact him at: The Wall Street Journal Sunday, 200 Liberty St., New York, NY 10281. Email: personal.business@wsj.com