Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: KevRupert who wrote (39665)	2/22/2000 11:50:00 PM
From: geekland	Respond to of 45548

Well, as a holder of both COMS stock and 3 different series of calls I'm as much a cheerleader and fantasizer as the rest of y'all longs. HOWEVER, there are MANY factors that enter into the mix - world events, e.g., China vs. Taiwan; overall tenor of the market (especially NASDAQ); Greenspan, his jawboning and how it coincides schedule-wise with our much-awaited IPO... etc. That's why I would NOT be buying the March 100 calls that many folks on other, more wild & wooly message boards are touting. Those are TOO FAR OUT and there are other, less reckless option plays that will still produce nice percentage moves due to leverage. (Watch, in 10 days someone will do a "Roast with the Post" by quoting this Ebeneezer Scrooge advice after COMS roars to $120!) There's no such thing as a sure thing and I've been shot down numerous times when all indications seemed to dovetail with my hypothesis and options strategy. Having said that, this COMS/PALM affair certainly DOES seem to have a whole lot going for it and my adrenalin is percolating! Time will tell... GOOD LUCK to all COMS L O N G S !!!

To: KevRupert who wrote (39665)	2/23/2000 10:14:00 PM
From: Uchos	Read Replies (2) \| Respond to of 45548

PALM Valuation... There will be 570 M shares outstanding and 23 M shares of float after the IPO. This is a HUGE number of shares outstanding, considering 3Com has only 366 M shares after 2 splits!! The 570 figure is what makes the market cap, and the basis for these calculations. At $16 a share, that makes it 9.1 Billion dollars of market cap. If PALM goes to $80 (5 times 16 dollar IPO price), that would make the market cap 45.5 Billion dollars!! Lets compare that to some other market caps based on today's closing price; CPQ 42.6 B$ Extrem networks 4.5 B$ Foundry Networks 13.1 B$ Juniper 36B$ !! Lucent 161B$ !!! Yhoo 87 B$ Comparing it to other companies, even ones with similar growth rates, 45.5 billion is a bit too much. Based on those numbers $100 stock price should really be far fetched?! However I think with all the hype, we could see a 30 B$ market cap, that would put PALM stock price at $52 1/2. Today's overall 3Com market cap is $26.7 Billion (including PALM). Take 9.1 Bs for palm, that leaves $17.6 B for 3com. If palm goes to $80 on its IPO day, that means 3com could have a market cap of 17.6x5 =$88 Billion (based on today's prices)!! That means 3com stock price would be $$215 ($88B/366M shares outstanding), probably a little less since 3Com will own 93.3% (not 100%) of palm after IPO. BUT, COMS market cap has more than doubled since the announcement and allot of the appreciation is already in the stock. Lets say it doubled since the announcement. That would mean the real 3Com portion of today's market cap is around $ 8.8 billion (17.6 /2). That means 3Com could go up to $107 (if PALM goes to $80). If Palm stayed at a 30 billion market cap and its stock at $52, 3Com would be valued around $69.55. With 570 M shares outstanding, I can't see how the stock could go above $100!!! I hope I'm wrong, but that's what my numbers tell me. Do you guys see any big holes in the above numbers? PY//