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Technology Stocks : EMC How high can it go? -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (11356)	10/11/2000 8:24:29 AM
From: bob gauthier	Respond to of 17183

Can Sun, EMC dodge the downturn? Two tech giants are down and there may be two to go By Mike Tarsala, CBS.MarketWatch.com Last Update: 12:14 AM ET Oct 11, 2000 NewsWatch Latest headlines SAN FRANCISCO (CBS.MW) -- First it was Cisco, then Oracle. Could the mighty Sun Microsystems and infallible EMC be the next of the e-business technology giants to have their stocks lopped? Making money was simple in the good ol' days of the New Economy: Invest in Cisco Oracle, Sun and EMC, and kick up your feet. With each of the stocks gaining eleven-fold over the past five years - and all more than five-fold in the past three - it's no wonder the stocks became darlings of Wall Street. Cisco (CSCO: news, msgs), Oracle (ORCL: news, msgs), Sun (SUNW: news, msgs) and EMC (EMC: news, msgs) rewarded investors handsomely by excelling at basic tenets of e-business -- respectively, networking gear, software, server computers and storage. But this year, it became clear that the highly valued stocks are in no way impregnable. New economy or not, drops in Cisco and Oracle shares of roughly 40 percent each from their year highs proved that the so-called four superstocks can't rise in a straight line forever. As the entire tech market remains under pressure in October, some market pros are starting to wonder if there are two superstocks down, and two to go. Regardless of Sun and EMC's performance, market strategists are staring to think the shares are poised for a fall, due to market conditions and the stocks' valuations. "The only stalwarts that haven't corrected are Sun and EMC," said Alan Skrainka, chief market strategist at Edward Jones. "They will. This has everything to do with valuation and the ridiculously high prices that people are paying for these stocks." Bernie Schaeffer of Shaeffer's Investment Research adds that the market is bound to take a bigger chunk out of Sun and EMC before the Nasdaq finds a bottom. "I would consider those stocks to be vulnerable," he said. "The modus operandi of this market is to have the leaders hang and hang until they can't hang anymore. Then they take the hit." Leaders Cisco and Oracle already have been knocked off significantly from their 52-week highs. Cisco's was first to go. It took more than a 30 percent dive in April and May. An article in Barron's that questioned the company's acquisition strategy and its accounting methods helped to spur valuation-driven selling. The stock remains off nearly 40 percent from its 52-week high. Next was Oracle. Its stock is down about 40 percent peak-to-trough since Sept. 1, mostly on valuation concerns. Analysts downgraded shares of the stock saying growth prospects didn't justify the share price. It didn't matter much that Oracle's net income growth of 111 percent in the August quarter bulldozed Wall Street estimates. Some feel that a grim fait also awaits Sun and EMC investors. So far, both remain relatively unscathed by the market's tumult thanks to nearly flawless execution. Sun's dropped only 19 percent since early September: EMC's down about 10 percent in the same timeframe. Execution, however, might not be able to save these stocks, so long as the market continues its bearish ways. What goes up must eventually come down. And for some strategists, Sun and EMC still haven't come down enough. Sun and EMC boast expensive P/Es Sun's price-to-earnings ratio sits at about 100; EMC's is 132. The big-cap stocks are arguably expensive in a healthy market, according to Skrainka. He notes that buying every stock in the past 28 years with a PE of 100 or more and holding it for five years only nets investors a 2 percent return a year. It's the unhealthy market that makes Sun and EMC all the more expensive, Skrainka says. There's a valuation gap when the stocks still carry a high PE while other tech heavyweights suffer at the hands of financial warnings from Lucent (LU: news, msgs), Dell (DELL: news, msgs), Intel (INTC: news, msgs) and others. Even pricey Oracle and Cisco now are below a 100 price-to-earnings ratio. Skrainka says that EMC, in particular, is due for a fall. At its current valuation, he calculates that it will have to increase revenue 55 percent to 60 percent for the next five years. "We don't know of any established company that can sustain 55 percent growth long-term," he said. To be sure, there are virtually no fundamental reasons why either Sun or EMC shares are headed down. And it should be argued that there are good reasons why their shares have held their ground better than competitors. Both are in fast-growing parts of the technology industry that aren't threatened by perceived demand problems plaguing Intel, Dell and the rest of the personal computer market. Both face stiffer competition - Sun from IBM (IBM: news, msgs) and Hewlett-Packard (HWP: news, msgs), among others, and EMC from feisty companies including StorageTek (STK: news, msgs). But each has fended off the competition by continually rolling out new products for which customers clamor. Earnings for each company are anticlimactic. Sun and EMC consistently beat analyst's revenue and earnings forecasts. Both are expected to do the same when they each report Oct. 18. It's almost not worth mentioning the obvious: That Sun and EMC shares could falter on any earnings glitch. "There's nothing magic about Sun or EMC," said Bruce Lupatkin, general partner with North Bay Technology Partners. "For any of these companies with high valuations, the market is very unforgiving about any kind of a miss." More to the point, without any fundamental troubles, valuation worries following earnings could send the stocks lower - some say by another 10 percent or more. "The reason stocks get hit so hard is that so many people are hanging in there for the earnings," Schaeffer said. "But the way this market has reacted to tech earnings, it would not shock me for these stocks not to react positively to the numbers. And that's going to bring the sellers out of the woodwork."

To: Proud_Infidel who wrote (11356)	10/11/2000 8:25:44 AM
From: bob gauthier	Respond to of 17183

McDATA's ED-5000 Supports Native FICON Attachment and Inband Management For IBM System 390 and IBM eServer* z900 Hosts & Devices McDATA Director Allows Open Systems and Mainframe Coexistence for Investment Protection BROOMFIELD, Colo., Oct. 11 /PRNewswire/ -- McDATA® Corporation (Nasdaq: MCDT - news), a leading storage area network (SAN) company, announced today its ED-5000 Director will now support FICON attachments to IBM S/390 and z900 enterprise servers hosts and devices with native FICON. The enhancements to the ED-5000 include updates to McDATA's Enterprise Fabric Connectivity (EFC) Manager software that provides enhanced management for both S/390 and open systems environments. The ED-5000 with FICON support is the next stage in the two companies' collaboration, after announcing McDATA's ED-5000 support of IBM open SAN solutions in March of this year. ``Users can now combine Mainframe, UNIX and NT storage needs all into one infrastructure,'' said Nick Allen, vice president and research director of storage for the Gartner Group. ``This is a big step towards the Storage Network Utility. Common, open, centralized management will be the next step.'' ``The ED-5000 Director with FICON support is an excellent example of how open systems and mainframes can coexist and how customers can get the highest value for their IT budget while protecting their investments,'' said Jack McDonnell, McDATA's president and CEO. ``It is the logical choice for customers who have IBM mainframes and open systems storage area networks in their computing environment, including IBM and non-IBM servers and devices.'' The FICON-supporting ED-5000-McDATA's third-generation Director-leverages the seven-year collaboration between McDATA and IBM. ED-5000, Release 3, incorporates the experience and expertise gained from two prior generations of ESCON Directors. All three generations of Directors have been designed to provide the highest levels of data availability and performance IBM mainframe customers demand from director-class products. The ED-5000 features include redundant power supplies and electronic modules, concurrent hardware upgrades and maintenance, and concurrent micro-code upgrades. In addition, current ED-5000 customers can upgrade their units to include FICON support. ``Native FICON support represents the sixth major program IBM and McDATA have worked on together since 1993, beginning with ESCON, then Fibre Channel and now FICON,'' said Steve Cartwright, director IBM Programs at McDATA. ``The announcements today are indicative of the working relationship we have developed with IBM.'' Flexible, Comprehensive Management The enhanced McDATA EFC Manager software of the ED-5000 supports and allows the configuration for both open systems and S/390 Director operational modes. EFC Manager eliminates isolated islands of workgroup or departmental data and enables single-console management of all switched components with enterprise-class scalability. The software streamlines troubleshooting processes by providing detailed logging, diagnostic and rapid error source identification. The ED-5000 can be managed inband by IBM's System Automation for OS/390 using a feature on the ED-5000 developed by McDATA. This feature enables customers to manage the ED-5000 Director in the same manner they traditionally managed ESCON Directors-a real advantage for customers as they migrate from ESCON to FICON. The ED-5000 is the first Fibre Channel product that provides this management capability. About McDATA McDATA provides highly available, scalable and centrally managed SAN solutions that address enterprise-wide storage problems. Leading the market with industry-defining director-class switches, McDATA's end-to-end SAN solutions improve the reliability and availability of data, greatly simplifying SAN management and reducing the total cost of ownership. These extensively pre-tested SAN solutions provide IT organizations with the comprehensive tools, methodologies and support essential to robust SAN implementation. McDATA distributes its products through its OEMs, network of resellers and Elite Solution Partners. For more information on McDATA, visit its web site at mcdata.com . NOTE: McDATA and the McDATA logo are registered trademarks of McDATA Corporation. All other trademarks and product names are the property of their respective owners. The IBM eServer brand consists of the established IBM e-business logo with the following descriptive term ``server'' following it. Forward-Looking Statements This press release contains statements about expected future events that are forward-looking and subject to risks and uncertainties. For these statements, we claim the safe harbor for ``forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. Factors that could cause actual results to differ and vary materially from expectations include, but are not limited to, our relationship with EMC Corporation and IBM, a loss of any of our key customers, distributors, resellers or our manufacturer, our ability to expand our product offerings and any transition to new products, component quality and availability, the development of the storage area network and switch markets, any change in business conditions, changes in our sales strategy and product development plans, competition in the storage area network and switch markets, competitive pricing pressures, continued market acceptance of our products, name recognition of our products, delays in the development of new technology, changes in customer buying patterns, Year 2000 issues, one-time events and other important factors disclosed previously and from time to time in EMC's and our filings at the U.S. Securities and Exchange Commission. These cautionary statements by us should not be construed as exhaustive or as any admission regarding the adequacy of disclosures made by us. We cannot always predict or determine after the fact what factors would cause actual results to differ materially from those indicated by the forward-looking statements or other statements. In addition, readers are urged to consider statements that include the terms ``believes,'' ``belief,'' ``expects,'' ``plans,'' ``objectives,'' ``anticipates,'' ``intends,'' ``targets,'' or the like to be uncertain and forward-looking. All cautionary statements should be read as being applicable to all forward-looking statements wherever they appear. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

To: Proud_Infidel who wrote (11356)	10/11/2000 9:23:30 AM
From: bob gauthier	Read Replies (1) \| Respond to of 17183

EMC Joins Forces With HP OpenView to Turbocharge and Simplify Backup and Recovery HOPKINTON, Mass.--(BUSINESS WIRE)--Oct. 11, 2000--EMC Corporation, the world leader in information storage, today announced immediate availability of the EMC Fastrax(TM) data movement platform. An integrated member of EMC's storage infrastructure, EMC E-Infostructure(TM), EMC Fastrax performs the resource-intensive movement of backup and recovery data between EMC Symmetrix® Enterprise Storage systems and industry standard tape libraries. The new Fastrax platform combines EMC and third-party software, open application programming interfaces (APIs) and data movement hardware. Fastrax enables customers using the HP OpenView OmniBack II backup/recovery application to leverage their existing investments in backup software, human resources and operating procedures. Customers are facing technology choices to address the elimination of the backup window and the need for rapid data recovery. Disk-based solutions such as EMC TimeFinder(TM) and Symmetrix Remote Data Facility (SRDF(TM)) enable non-disruptive backups along with virtually instant data recovery. Traditional tape backup implementations facilitate non-disruptive backups, however, lack the robust capabilities for rapid data recovery. Fastrax fills the void by delivering the non-disruptive backup features of disk and tape solutions while providing faster data recovery times when compared with traditional tape backup offerings. EMC customers are able to choose between disk-based solutions, tape-based solutions or a combination of the two depending on their data recovery objectives. Customers can implement TimeFinder, SRDF, EMC Data Manager (EDM(TM)), Fastrax or integrated combinations of the above to meet their needs for instant recovery of data and to backup and restore less-critical information at high speeds. The Fastrax data movement platform builds on the openness of the EMC offering and enhances customers' ability to move information between EMC Symmetrix and non-EMC devices. Through cooperative development between EMC and HP OpenView Storage Management, Fastrax supports backup and recovery of database information via one of the industry's premier backup and recovery applications and the first to support Fastrax, HP OpenView OmniBack II. Through its open E-Infostructure Developers Program, EMC over time will extend Fastrax support to additional data movement applications such as content distribution and data migration, and provide support for non-tape devices. Fastrax enables customers to perform tape-based back up of even the largest Oracle databases with no impact to host servers, applications or data access, a major source of conflict and complexity in backup operations. Fastrax backups take place while the same data is being used by production applications. The backup and recovery application determines what data needs to be backed up, then Fastrax and Symmetrix software transparently determine which data needs to move to tape and which needs to go to the active database. Additionally, multiple backups can be started and run concurrently. Jack Garrahan, EMC's Vice President of Global Marketing, said, ``We're in the midst of a content Big Bang. The resulting demand for optimal performance and non-stop information availability continues to surge, and with it comes new levels of information management complexity. Fastrax changes the rules for enterprise backup and recovery, and helps customers address these issues head-on with an infrastructure for the requirements of today and tomorrow.'' ``As an enabling technology, Fastrax helps EMC customers more efficiently exploit existing investments in backup and recovery infrastructure,'' said John Webster, Analyst and IT Advisor, Illuminata. ``Fastrax adds high performance backup to the process without introducing complexity or disruption to business operations.'' Fastrax serves as an ``outboard engine'' that offloads network- and server-consuming movement of backup data from the production environment. The combined strength of Fastrax and integrated backup application software enables backups of data which can include complete databases as well as individual user-level objects, such as database indices and files. Fastrax eliminates the need for customers to purchase large, expensive backup servers to manage tape drives. Fastrax reduces the backup server's role to command and control purposes only, resulting in the need for smaller and fewer backup servers and eliminating the need for constant software installation, server maintenance and management costs. Application integration with Fastrax is achieved through the EMC E-Infostructure Developers Program, which provides wide-scale access to EMC application programming interfaces (APIs). The program enables customers to select from, and rapidly integrate, a large variety of information management, sharing and protection tools. These solutions, developed and sold by third-party companies, allow customers to more easily manage and implement their electronic information infrastructure. About HP OpenView HP is one of the world's largest providers of integrated management solutions for service providers, the electronic enterprise and the medium-sized enterprise. HP OpenView solutions are at work in more than 120,000 multivendor distributed computing environments worldwide. Together with offerings from more than 200 partners, HP OpenView offers a complete portfolio of services and management solutions on all major platforms. Information about HP OpenView and its solutions can be found on the World Wide Web at openview.hp.com and openview.hp.com. About EMC EMC Corporation (NYSE:EMC - news) is the world leader in information storage systems, software, networks and services, providing the information infrastructure for a connected world. Information about EMC's products and services can be found at www.EMC.com. EMC2, EMC and Symmetrix are registered trademarks and EMC Enterprise Storage, EMC Enterprise Storage Network, EMC E-Infostructure Developers Program, EMC Proven, E-Infostructure, Fastrax, SRDF, TimeFinder and EDM are trademarks of EMC Corporation. Other trademarks are the property of their respective owners. This release contains ``forward-looking statements'' as defined under the Federal Securities Laws. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) component quality and availability; (ii) delays in the development of new technology and the transition to new products; (iii) competitive factors, including but not limited to pricing pressures, in the computer storage and server markets; (iv) the relative and varying rates of product price and component cost declines; (v) economic trends in various geographic markets and fluctuating currency exchange rates; (vi) deterioration or termination of the agreements with certain of the Company's resellers or OEMs; (vii) the uneven pattern of quarterly sales; (viii) risks associated with strategic investments and acquisitions; (ix) the ability to attract and retain highly qualified employees; and (x) other one-time events and other important factors disclosed previously and from time to time in EMC's filings with the U.S. Securities and Exchange Commission.