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

To: Tim McGee who wrote (41025)	3/2/2000 6:11:00 PM
From: miklosh	Respond to of 45548

$60 is 50 dma for coms so we might get close before fundamentals take hold. <Its not clear the bleeding is over yet but it should move back up when clear minds prevail. >

To: Tim McGee who wrote (41025)	3/2/2000 6:36:00 PM
From: Mang Cheng	Respond to of 45548

Tim, I totally agree with your post and I would like to add the following analysis: We'll use my calculator as the analysis tool. First of all, plug in (right mouse click and open wth new window) : connect.ab.ca $50 to Actual Palm price (this is just a simulation) and $81 to actual coms price. You'll see that the market cap of palm and coms are both at 28 billions. and down below it shows that the discount is 40% (coms at $80). That means when Palm at $50 and coms at $81, coms is selling at a discount of 40% in relation to the $50 Palm. This tells me the following : 1. the market is skeptical about the current palm price. My estimate is that the street is assigning a fair-market value of $50 to Palm - regardless of how much it's trading today. As Palm builds up an history of trades, the street will re-access the fair value for palm. 2. secondly, at 40% discount, the street is very cautious about the whole thing - and they want to reestablish this $81 level as the baseline for any future re-valuation. 3. Based on the above two findings, I think coms will do well when Palm consistently trade at a stable level above $60 - We don't need Palm to be over $100 for coms to do well. If Palm stabilizes, the fair-value awarded to Palm will go above $50 and the discount level will shrink. If the Street readjusts the fair-value of palm to be $60 and awards a discount ratio of 30% to coms, we should be back to $98 in no time. Try that with the calculator. The calculator is emotionless and it doesn't lie. Not like me I have been crying whole day ! <g> Hope I am making sense here. Mang