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Technology Stocks : Applied Micro Circuits Corp (AMCC) -- Ignore unavailable to you. Want to Upgrade?

To: who cares? who wrote (1023)	12/3/2000 2:23:41 PM
From: Raymond Duray	Read Replies (1) \| Respond to of 1805

Hi C.M., Perhaps you are correct, perhaps AMCC will continue to grow at an exceptional rate. I do admire the management of the firm. But in a world where most growth comes from acquisition, and most acquisition is paid for with shares that, frankly, have until recently been trading at a stratospheric level, then it is prudent to wonder how a potential acquisition candidate might view the payment for their technology. I'm mere counseling caution at this juncture. And I would advise a bit of reading of history. Perhaps you might see the wisdom of another analogy. In you parable, you say that AMCC would maintain it's value because it made the vehicle more valuable and therefor maintained its stock price. I would advise a reading of the history of RCA, which in 1929, was selling a unique new technology to the Ford Motor Company and was trading at about $300 per share. By 1933, Ford was still putting radios in their vehicles, but RCA, although still profitable, had a stock that was at the time trading at $30. Think about that one. The companies that make the old components are the ones whose valuations should get squished, but Wall Street being a herd mentality, and the herd always taking the safe path, has decided to smoosh all telecom valuations. And your point is that this time it will be different? Best, Ray :)