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Technology Stocks : NENG: Network Engines, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Hal Campbell who wrote (21)	8/22/2003 5:12:49 PM
From: Gus	Read Replies (1) \| Respond to of 186

I did not buy...I was just convinced Ah, sorry 'bout that. I thought you finally bought. $15? Yeah, I think NENG can support a $500M+ valuation with a run rate of $50M+ per quarter.<g> Your intutitive style may not be all that rusty, dude. Anyway, when you do come baaack to the market space you probably want to use this space to reestablish your positions in storage. Here's why. Sun accounted for 80% of HILL's revenues in the last quarter while EMC accounted for 49% of NENG's revenues. EMC regularly captures around $1 out of every $2 spent on enterprise storage attached to Sun's Solaris platform. 1 out of every 3 of Legato's Networker backup product is also used in a Solaris environment and EMC/Legato have already telegraphed how they are going to disrupt the traditional backup and restore market which currently has a failure rate of 40% or so. HILL probably gives you a look at Sun's progress in enterprise storage, *in terms of units,* while NENG probably gives you a look at EMC's progress in that same area, in terms of revenues. More bang for your due diligence buck! As of 6/30/03, 104 institutions own 56% of HILL while only 25% institutions own 25% of NENG. Setting aside the mechanical index money -- which currently appears to be moving into small-cap HILL more than into micro-cap NENG , few institutions actually own both NENG and HILL. That may be changing. Here's one manager with a hot hand who appears to be working the complementarity of these two positions. <font color=blue> Two of the most recent additions to the Oberweis portfolio (which gained 47.9% in the first half of 2003, according to the Hulbert Financial Digest) are storage networking companies: Dot Hill Systems and Network Engines. Both companies meet the Oberweis requirements of more than 30% annual growth in sales and profits, a P/E ratio more than double the long-term growth rate, and a strong balance sheet. </font> forbes.com Have a good weekend, Hal.