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

To: SPSEIFERT who wrote (11941)	1/24/2001 12:11:47 PM
From: hamsandwich	Read Replies (1) \| Respond to of 17183

Comments from Briefing.com regarding the NTAP downgrade and NAS dynamic with EMC: Network Appliance (NTAP) 63 5/8 -9 15/16: The number one network-attached storage company is getting hammered today after a couple of downgrades from Goldman Sachs and Salomon Smith Barney. In fact, Goldman is dropping NTAP from its Recommended List to Market Outperform. They are concerned about softening demand in several key end markets and high valuation. Briefing.com adds the concern that EMC plans to aggressively go after the NAS market with some recent new product introductions. The concern with NTAP is becoming a common theme among IT hardware providers. While NTAP is expanding its exposure to new markets and gaining traction in existing ones, the gains should be offset by slowing spending by telecom companies and dot-coms for the near term. Some are concerned that forecasts for 2001 need to come down, however, an acceleration and upside are possible in 2002. On the valuation front, the company is pricey like many of the other storage stocks. First Call has NTAP expected to earn $0.58 in fiscal 2002 (ending April) so even with today's sell off, the stock is trading at a forward p/e of 110x whereas EMC is trading at a forward p/e of around 80x. We're not saying that EMC is cheap, our point is that both are richly valued. EMC (EMC 80 7/16 +7/8) is not fazed by the NTAP downgrades. Other storage plays are not being affected (QLGC is selling off for other reasons). See our recent Stock Brief on the Storage Sector. -- Robert J. Reid, Briefing.com

To: SPSEIFERT who wrote (11941)	1/24/2001 12:18:54 PM
From: Tony Viola	Read Replies (1) \| Respond to of 17183

SP, >I am a NTAP investor. I follow very closely what the competition is doing . In a market with this potential everyone is scrambling like hell. Watch very closely what is being said and what is happening in NAS. From what I have been able to gather EMC is doing a poor job outside of their SAN environment. Don't be fooled about their NAS growth because it has have to have a SAN environment to operate in. I have my money on NTAP but you need to do your DD. If you are curious go to the NTAP site and read all of the DOWN SOUTH messages and then form your own opinions. I have watched EMC and NTAP pretty closely for quite a while. EMC's story is definitely not NAS yet, but SAN is a very rapid grower also, and from a larger base at this point. Also, direct attached storage is still a cash cow. EMC's dominance at the high end, including their storage management SW, and interoperability across all important platforms, makes them the king, if not gorilla of storage. They are THE storage company of choice by all from the dot coms to the Fortune 500s. NTAP, has done a great job and has a great future, well, here's an opinion I expressed about them from a request from Ibexx over on the Intel thread just a few days ago: To: Ibexx who wrote (125716) From: Tony Viola Sunday, Jan 21, 2001 6:18 PM ET Reply # of 125916 Ibexx, no, I don't have any NTAP. I missed it in its early runup days, then became concerned for its over-valuation. I'd still be leery of it getting severely price corrected, a la SUNW, if anything went wrong. NTAP did a great job establishing a franchise, no doubt about it. Problem is, I don't think the cost of entry to NAS is anywhere near that of SAN. EMC and Compaq, maybe more companies, have new entries in NAS. Compaq's is right up their alley, being half server and half storage, and all industry standard components. They can probably build it very cheaply. Thing is, how strong NTAP's following is. I don't know. You probably saw this: Message 15219984 BTW, one advantage of this thread being so "anything goes" is that you don't have to say "OFF TOPIC". Tony This morning Laura Conigliaro of Goldman Sachs came out about NTAP, saying because of a slowdown in spending by some of the key customers in the communications area that would affect NTAP sales, and a very rich valuation, NTAP was not the place to put your storage investing money. She concluded by saying the place to put it was EMC. Tony