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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: Linkdog who wrote (18086)	1/12/2000 6:47:00 PM
From: James Calladine	Read Replies (1) \| Respond to of 42804

SECOND TIER OPTICS COMPANIES (like MRVC) From Briefing: <14:30 ET ****** Day Trader : The stock is up ten points going into the last hour of trading, why not get in now in hopes of a rally into the close and gap open in the morning... It is this "investment" philosophy that has driven all-things-photonic to celestial levels over the past several months... You know the names, JDS Uniphase (JDSU), SDL Inc (SDLI), E-Tek Dynamics (ETEK) and Sycamore Networks Inc. (SCMR). Flying slightly lower on the radar screen are names such as Ortel (ORTL), NetOptix (OPTX), MRV Communications (MRVC) and Precision Optics (POCI)... Ask investors/traders which group they think has been the strongest of late and most likely to guess B2B stocks. However, price advances by the second-tier fibre optics stocks suggest that they may be valid candidates for the top-spot. On average, ORTL, OPTX, MRVC and POCI have advanced 398% over the past ten weeks, with POCI pacing the group with a 955% move... Is there any question that the demand for optical components and systems will continue to increase at a breakneck pace over the next 18-24 months? Not really. Do fundamentals (i.e. earnings growth) justify fundamentals? Only if you are looking out 5+ and don't expect the stocks to appreciate any further from current levels. But as you're probably aware, it has been a long-time since valuations have mattered. Over the past three years, the primary metric used by investors (and analysts) to value companies has evolved from Price-To-Earnings (1997), to Price-To-Sales (1998), to Price-To-New High (1999)... However, given group's momentum, only two things that can knock the legs from under these stocks: 1) a tech market correction; 2) individual profit warnings/indications of moderating growth... For the sake of comparison, we throw in Yahoo! (YHOO) into the attached table. Based on its valuation versus expected growth rate, argument certainly can be made that market leaders such as JDS Uniphase are still trading at dirt cheap levels. Of course, the other side of that argument is that both groups are overvalued. But when investors are making money hand-over-fist, that song just doesn't sale. - DS> So now we know what at least Briefing thinks MRVC is! Best wishes, Jim