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Technology Stocks : Covad Communications - COVD -- Ignore unavailable to you. Want to Upgrade?

To: ronayre who wrote (1322)	10/4/2000 2:20:47 AM
From: Dale Stempson	Read Replies (1) \| Respond to of 10485

Random thoughts... Rar, It appears to me that we're simply experiencing a move away from anything that's difficult to value. If my math is correct, COVD consensus loss projections for the next six quarters combine to total almost $1.2 billion (and these estimates all come from analysts who are positive on the stock). While I believe very few folks are concerned about Covad obtaining the financing they'll need, it does represent a significant amount of cash and a long period of waiting time. We may currently have a bright long-term future, 18 buy ratings and 5-year projections of 40% growth, but when your not making money and folks are shifting their focus to value, companies like COVD have trouble making the list. Combine this with seasonal mutual fund and institutional selling and we have a formula for a lower stock price. Assuming this is somewhat correct (and we don't have any hidden problems) I guess my first question is: If this sentiment continues, where's the bottom? Well, obviously I thought we were there when I bought at 10-1/2. Today's action caused me to rethink things. That's why I didn't add when we broke $10 at the close. I suspect that if the market turned extremely ugly, we could still move down to near book in the $5 to $6 range. While I seriously doubt we'll ever see that level, I wouldn't be surprised if we did move a point or more lower from here. Perhaps the more important question is: How long will this sentiment last? Well, that's more difficult to answer. I'm hoping that when we get through these earnings disappointments and begin to see earnings reports for the quarter, there will be enough positive results and forecasts in the tech sector to alleviate much of the fear that has built up. If this happens, I think we'll see folks buying bargains like COVD. In any case, just my opinion FWIW. Regards - Dale