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Technology Stocks : Wind River going up, up, up! -- Ignore unavailable to you. Want to Upgrade?

To: Brian Lempel who wrote (9558)	5/4/2001 12:14:23 AM
From: lkj	Read Replies (1) \| Respond to of 10309

Hi Brian, Can you post the lily pond URL again? Thank you, Khan

To: Brian Lempel who wrote (9558)	5/4/2001 11:33:15 AM
From: Knight	Respond to of 10309

In closing, I'd simply like to add that for a long term WIND investor, this is a non-event. While there are added risks in the short term, there is also a very good chance that the company will emerge in a much stronger position. This downturn may very well end up being a non-event for long-term WIND investors; however, there are a couple of things that worry me. First, if WIND's stock price becomes too depressed, they could become a target for some other larger company to acquire on the cheap. As a long-term investor, I would consider an acquisition as a very negative thing (even if it were, say, $60/share) since it would dilute my ability to participate in the awesome long-term profit potential I see in WIND's business. Second, while I agree that WIND will likely come out of this stronger than their current competitors, I can also envision some factors that could hurt WIND. For example, if WIND's potential customers are trying to cut costs, might they be more likely to choose some Linux RTOS to avoid the licensing fees in the short-term (and royalties in the long-term)? Although WIND can probably argue (validly) that any Linux RTOS would actually cost more in the long-term due to fewer tools, longer time to market, etc., these sorts of factors are not always correctly factored into R&D spending decisions--especially when the decision-makers are trying to make the income statement look good for next quarter. Another factor is simply this: the market here is still in its very early stages. Since WIND is currently the clear leader, it is to their advantage for growth to accelerate (in Gorilla Gaming terminology, "for the tornado to hit" ) as quickly as possible. Any delay in the arrival of "the tornado" is bad for WIND in the sense that it provides extra time for some potential competitor to get a foothold. [Note: My concern for WIND in this area is alleviated somewhat by the fact that they appear to have formed an extremely strong value chain.] Disclosure: WIND is my largest holding, and I'm obviously still bullish on WIND.

To: Brian Lempel who wrote (9558)	5/6/2001 5:55:32 AM
From: Don Lloyd	Respond to of 10309

Brian - The following reference to the full H&Q report doesn't seem to have made it to this thread yet. messages.yahoo.com The key thing to take from this report is that the news is likely to get significantly worse before it gets better and the relatively positive stock action on friday is unlikely to be sustained. In particular - FY02 rev. yr/yr growth estimates reduced from 30.2% to 3.4% FY02 EPS yr/yr growth estimates reduced from 30.8% to -55.8% FY02 EPS estimate of 29 cents, down from the previous management guidance of 68 cents, represents an approximate PE of about 90X If a 30X PE were assigned to match the 30% growth rates which no longer appears in the near term and if it were applied to the unreduced FY02 68 cents guidance, it would still only give a stock price of $20.4. My conclusion is that there is little likelihood that writing covered calls against WIND stock over the next 3 to 6 months will reduce total returns as compared with simply holding long stock. Regards, Don

To: Brian Lempel who wrote (9558)	5/7/2001 10:00:38 AM
From: Allen Benn	Read Replies (1) \| Respond to of 10309

What earnings warning? Did you experience a weird feeling that the dreaded earnings warning conference call was strangely upbeat? What I heard is that WIND may make their prior guidance of 6 cents, but for sure they will make between 4 and 6 cents. It was evident that the pluses favoring WIND in a down technology economy cannot fully compensate for the minuses, as management hoped. Yet, with reduced revenues they may still come close to earlier guidance. The company has finally succumbed to the tough but necessary requirement to rationalize the merger with ISI and a bunch of other, smaller companies and technologies. Although hard on the rank and file, the move is a positive for investors and the long-term viability of the company. Dollars to donuts WIND will continue hiring needed technical workers even while redundancies are being eliminated in areas such as administration and sales. The sizeable layoffs will jump-shift WIND’s operating margins to levels more in line with times past once revenues begin to reaccelerate. But, if the company actually might make its earnings guidance, why the warning, even though revenues will be down? BTW, this is the first warning WIND ever issued, even though it missed at least two or three quarters over the last couple of years. What’s different this time? The answer is pretty obvious and TSD did everything but yell it out at the conference call. That’s why the call was so uplifting, the opposite of what I expected to feel. In my opinion, the real reason for warning is that WIND has a major product announcement that will be uplifting the stock price, and feels an obligation to clear the decks of any near-term bad news before making the announcement. The date of the announcement is today or tomorrow. The site of the announcement is the Network Interop trade show in Las Vegas. The product to be announced is something related to the IP mega trend I posted on the other day. In particular, Storage over IP, SCSI over IP (iSCSI), offloaded TCP/IP NIC, or some such thing. It is big because WIND is optimally situated to put the following server technologies altogether around IP: BSD Unix, iRAID, iNIC, managed switch/router using intelligent network processors and TMS, iSCSI (never announced before now), I2O and Infiniband. I don’t have any inside information, nor am I just guessing. I just realized the product announcement had to be the driver of the warnings and looked around. This is what I found: Wind River is very excited to be announcing the launch of a NEW networking product at N+I! Be one of the first to hear the news and visit our booth for more details. And apparently this doesn’t include iSCSI, since it is mentioned separately. In any case, I think the following link tells the tale: windriver.com Allen