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

To: Gus who wrote (14383)	8/12/2002 4:18:09 AM
From: Elroy	Read Replies (1) \| Respond to of 17183

No. EMC and Sun do not have the same growth prospects in storage. Obviously. Well only obviously if you make 5 year projections that say EMC's market will grow faster, and then accept those projections as facts. I don't agree with your forecasts, so I don't agree with your conclusion. I see two companies (SUN, EMC) with similar competitors (IBM, HPQ), similar gross margins (Sun's are actually a bit higher than EMC's), similar price pressure from the low end and a similar growth driver (increased network usage through new applications). Both are strongest in the high end of their fields (storage and servers), and have experienced similar revenue declines last year (is Sep '01 EMC's revenues fell 41% year on year, Sun's fell 43%). With them being so similar in so many ways, how can you justify EMC being 3x more expensive on price to sales? EMC's growth outlook may be modestly better than Sun's (and that is not even guaranteed), but it certainly isn't 3x better. Either EMC is too expensive, or Sun is too cheap.... Elroy