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To: Jim Lou who wrote (859)	2/20/2000 8:15:00 AM
From: Boonear Siangchin	Read Replies (3) \| Respond to of 1762

First of all, are you one of those wonks? How do you just the valuation of DMIC? The PE is only 17. This is the reason why those money managers are looking for more shares.

To: Jim Lou who wrote (859)	3/1/2000 2:45:00 PM
From: Rob Preuss	Read Replies (1) \| Respond to of 1762

A few weeks old but... (found this on the Yahoo message board for DMIC) Prudential Analyst John H. Butler (212) 778-1488 has an Accumulate rating on DMIC on Feb.9, 2000. Here is the summary of the report: ------------------------------------------------- Strong order trends and promising outlook for Altium were the highlights of the quarter. Maintaining Accumulate rating and raising price target to $44. Expected earning for fiscal year: $0.15 Y2000, $0.50 Y2001. Believe Strong Order Growth Raises Visibility On Future Top Line Growth. Digital Microwave (DMC) reported solid F3Q00 results on January 19, 1999, and posted particularly impressive order trends. Specifically, the company reported 3Q00 EPS of $0.05 on $77.4 MM in sales. This compares with our estimate of $0.04 in EPS on $74.6 MM in sales. We note that our estimate was in-line with consensus. The company reported total F3Q00 orders of $104.3MM, up 47% sequentially from $71.2 MM last quarter. These impressive results highlight the strong progress that DMC is making in the wake of a protracted industry slump that extended through the middle of calendar 1999. The only weak spot this quarter was DMC?s gross margin, which was flat on a sequential basis at 30.2% and shy of our 31% estimate. Although a number of factors contributed to this relative weakness, the two biggest reasons were higher-than-expected costs for the new DXR-700 long-haul system and a larger-than-expected revenue contribution from Spectrum II. Spectrum II is an aging product line that commands a relatively low gross margin. But despite its age, Spectrum II enjoys a large installed base, and the overall recovery in demand for microwave is driving strong sales of Spectrum II. As a result of these trends, management issued more cautious guidance in regard to future margin trends. Fortunately, this more cautious guidance is offset by an increase in our revenue assumptions in coming quarters. Moreover, the latest order trends suggest that there may even be some upside to our revised revenue estimates. Clearly, the highlight of the quarter was the impressive ramp in orders, which reflects a strong rebound in demand for microwave radios. As mentioned above, DMC?s total orders during F3Q00 rose an impressive 47% sequentially, which compares with F2Q00 when orders were up only 4% sequentially. Importantly, orders were up in all regions and across all of the company?s product lines, except for long haul. We believe that the single biggest factor to account for these results is a strong rebound in worldwide demand for microwave radio. In addition, many operators have much greater access to capital than they did just 6 months ago. This is a key development for DMC which derives a significant amount of business from emerging carriers in the Asia/Pacific region as well as Latin America. We also believe that several domestic operators (most notably WinStar and Teligent) are beginning to accelerate their construction of fixed broadband wireless networks. Both carriers are important customers of DMC?s. The order trends for Altium look very promising, leading us to believe that this key new product will meet or beat our future expectations. Altium sales during the quarter were roughly in line with our $12.5 MM estimate. But the key metric to watch for Altium is orders, which were up over 3-fold on a sequential basis to $18.4 MM. The success of Altium figures heavily into DMC?s financial performance over the next couple of years. As a result, we believe that the performance of DMC?s stock will, to a large degree, track the performance of Altium. So these latest order trends are encouraging as they support our view that Altium is a best-of-breed product in the high-capacity microwave segment. For the current quarter (F4Q00), we conservatively estimate that Altium sales will total $15 MM, bringing our full year estimate for Altium up to $43.7 MM. For fiscal 2001, we expect sales of Altium to more than double to $89 MM. Importantly, management indicated that sales of Altium are pulling through rather significant sales of the company?s narrowband microwave products. So as DMC broadens its customer base for Altium, we expect this trend to have a positive impact across the company?s whole product portfolio. Overall, we continue to view DMIC as a solid story and an excellent way to invest in growing demand for wireless infrastructure equipment. DMC has staged a remarkable recovery over the past year, and we are confident in it?s ability to ride the recent momentum in the underlying market. In our view, the year 2000 will be a good year for wireless infrastructure suppliers, as carriers work to put the appropriate infrastructure in place to deploy fixed broadband wireless services as well as mobile wireless data services. In our view, DMC is very well positioned to benefit from this theme and certainly, the latest order trends at DMC support this view. As a result, we continue to rate the shares of DMIC Accumulate with a 12-month target of $44.

To: Jim Lou who wrote (859)	3/7/2000 11:38:00 AM
From: Rob Preuss	Respond to of 1762

DMIC recommended by Sally Anderson, Kopp Emerging Growth Fund this morning on CNBC. members.boardhost.com Fund synopsis... + Fund is up 60.41% year-to-date. + They have tripled in 3 years. + Fund is 80% technology weighted so the impact of the Fed is negligible. + Their median market cap is 850M. They try to keep it under 3B but will go higher if merited. History of similar DMIC recommendations... netcognizance.com

To: Jim Lou who wrote (859)	3/9/2000 1:42:00 AM
From: Rob Preuss	Respond to of 1762

[Dain Rauscher Wessels reiterates "Buy Aggressived". Target $54.] Found on Yahoo... 10:49am EST 8-Mar-00 Dain Rauscher Wessels (Searle, CFA, Scott (612)313-1219) [12 ú Rcvd: Mar 8, 08:58 PM EST ] TFN First Call March 8, 2000 Dain Rauscher Wessels a division of Dain Rauscher Incorporated * Quarter appears to be on track to meet expectations; outlook building for June. * Altium sequential ramp continues with both revenues and orders. * Product development is underway to further position Digital Microwave as a premier player of broadband PTP solutions. * We are raising our 12-month price target to $54 and maintaining our Buy- Aggressive rating. Digital Microwave Corporation NASDAQ:DMIC Rating: Buy Risk: Aggressive Price Target: $ 54 Mar 8, 2000 _____________________________________________________________________________ Price: $36.38 \| Fiscal Yr Prev EPS P/E 52-Wk Range: $42-$7 \| Mar/1999A ($0.47) NM Tr. 12 ROE: NM \| Mar/2000E $0.13 NM 3 Yr EPS Gr: 40.00% \| Mar/2001E $0.40 91.0x Shares Out: 71.50 million \| 2001 Q1 $0.07 Book Value: $2.82 \| Market Cap: $2.60 billion \| _____________________________________________________________________________ Calendar Yr Prev EPS P/E Mar/1999E $0.02 NM Mar/2000E $0.34 NM _____________________________________________________________________________ __________________________________________________________________________ WIRELESS COMMUNICATIONS Scott Searle, CFA (612) 313-1219 ssearle@dainrauscher.com DMIC:B-Aggr;PART 2/2: QUARTER ON TRACK, ALTIUM RAMP CONTINUES; RAISING PRICE TARGET continued... Stock Opinion ((Raising Price Target To $54:)) \|\|As the market continues to focus on broadband access and backbone technologies, we believe investors will gravitate to Digital Microwave as a leader in broadband PTP wireless, which remains dramatically discounted to other broadband segments. For example, in the broadband access market, industry leaders such as Netro (Nasdaq: NTRO; SB-Agg, $59) in wireless and Copper Mountain (Nasdaq: CMTN; SB-Agg, $93) in DSL trade at 21x and 13x 2001 revenues, respectively. In contrast, DMIC shares trade at 6x 2001 revenues. Additionally, fiber vendors such as Ciena (Nasdaq: CIEN; SB-Agg, $169), JDS Uniphase (Nasdaq: JDSU; SB-Agg, $287), etc. trade in excess of 20x 2001 revenues. We believe these names will prove to be viable comparables as the company continues to establish its presence as an extension and, in some cases, an alternative to fiber. \|\| \|\|Using a blended multiple of 5x-6x core narrowband revenues and 18x-20x broadband (Altium) revenues, we reach a price target range of $51-$58. While our assumption for the core narrowband multiple is at the high end of the historic range (more than 5x) we believe it is reasonable given the product breadth of the company, which has resulted in multiple bundled sales in recent quarters (20%-plus of sales in the December quarter). Hence, the broadband business is pulling the narrowband business through the channel. Meanwhile, we view the broadband multiple as extremely reasonable given the increasing focus on broadband technologies, multiples of other high-profile broadband wireless players, and an expanding presence for the company as a viable extension or alternative to fiber, particularly in emerging markets. We maintain our Buy-Aggressive rating with a $54 12-month price target.