Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: High-Tech East who wrote (44629)	8/28/2001 10:20:36 AM
From: JDN	Read Replies (2) \| Respond to of 64865

Dear Ken: I COULD use that EXACT ARGUEMENT to PROVE they will FUEL our economic recovery cause THEY will provide us raw goods and services at BARGAIN BASEMENT PRICES. Rest Assured THE USA WILL BE THE FIRST to recover and recover the FASTEST even while the rest of the World muddles around. Remember, you heard it here FIRST. SUNW, $25 by year end (12/31) or BUST. Put it on your bumper. JDN

To: High-Tech East who wrote (44629)	8/28/2001 9:25:13 PM
From: techtonicbull	Read Replies (1) \| Respond to of 64865

. SUN SET TO GIVE MID-QUARTER REPORT, BULL MARKET REPORT SELLS Goldman Sachs (GS, $81, down 1) cut earnings and revenue estimates for Sun Microsystems (SUNW, $13.56, down 0.94) on the eve of the computer and software maker's mid-quarter report. Despite Sun's strong product line, Goldman Sachs thinks the economy will to continue to lay a beating on Sun, and now forecasts earnings of a penny a share on revenue of $3.7 billion. Previous analyst estimates called for earnings of 2 cents a share on $3.8 billion in sales. Sun remains stuck in the same boat along with many other computer and software makers. The weak economy and slow demand for new technology has left products piled up in factories, and any sort of high-tech recovery now looks like it could take much longer than many had anticipated. TODD'S TAKE: We've decided to remove Sun from our Long-Term Core Holdings Portfolio. It is a solid company with great products, but with the economy stuck and a tech turnaround still out of sight, we've decided that we don't want to hang around only to have Sun disappoint us once more. We've written some very cautionary articles on this one in recent weeks, and have followed the stock very closely over that time period. We can assure you that the Goldman downgrade had nothing to do with today's decision, but it just so happens that both Goldman and BullMarket.com are pretty skeptical of this firm right now. Like so many in the tech sector, the economy has sucked the wind from Sun's sails. The company is moving products -- $3.7 billion in revenue this quarter! -- but it hasn't translated those sales into profits. The company is looking at a profit of a penny a share for the quarter, and that simply won't cut it. We can't point to one particular thing that Sun has done or hasn't done that has convinced us to sell. Instead, today's decision is culmination of a number of events that have happened in recent months, and we've decided that we're ready to bail out. The company lost ground in the server market to IBM (IBM, $105, down 2) in the second quarter, dropping 2 percentage points to 21% market share compared to IBM's 29%. Sun launched it web-services initiative, SunONE, in February, but still has nothing to show for it. Now with Sun's third quarter looking more and more like it will come in lower than expected and the overall slump in the tech sector holding on tighter than we anticipated, we have decided it is time to move on here. We have to stress that our decision to sell Sun might not be for everyone. As we said, the company has a great product lineup and over the long haul, Sun is going to capitalize on its technological strengths. The problem is that right now the long haul just looks too long for us. Sun's earnings and revenues could easily stay flat for 2002. With its current PE hovering near 15, that kind of performance isn't going to do much for its share price. With these kinds of prospects ahead for Sun, we cannot justify leaving our money in it while companies like Proctor & Gamble (PG, $75, down 2), ExxonMobil (XOM, $41, down 1), Crescent Real Estate Equities (CEI, $25, unch.) and General Electric (GE, $41, down 1) are delivering the goods. With the business environment still a tough one, we have decided to increase our positions in defensive companies like these. We will sell Sun at the opening bell tomorrow.