To: Jeff Mills who wrote (21160 ) 11/4/1997 8:38:00 PM From: mugicha Read Replies (2) | Respond to
I am bullish on ASND but for different reasons. I must point out that the companies you are comparing ASND with deserve higher multiples since they are delivering far better results than Ascend is. That doesn't mean that Ascend is not a buy at these prices, but I want to caution anyone simply buying because ASND looks cheap compared to COMS and CSCO. I remember people doing the same comparrisons with ATCT back when it was $12 a share. ATC also looked cheap compared to other stocks in the same industry. Now you can have ATC for $3 a share. Obviously, other factors than price to sales, price to earnings, price to book etc, must be taken into account. These are based on past results and therefore can show a bias if the current outlook has changed (which it has for ASND). Anyway, IMO, ASND is a buy for several reasons: (1) A wide array of excellent products (2) Participating in an increasingly important market with 40% growth expected (3) Have probably worked through most of the problems with MAX TNT and the worst should be behind us (4) Conditions expected to improve in Japan and Europe towards the middle to late part of 1998 (5) Every analyst who didn't get a chance to ride ASND on the way up before, has been waiting for an opportunity to buy ASND cheaper. I believe the time has finally arrived. Institutional investors and shorts will be the catalyst for the early recovery of ASND. From there it will be the earnings that carry this one forward. Those buying now are taking advantage of an opportunity that doesn't come along too often. Want some examples of what can happen for those who get in at times like these? (AMAT, BAY, COMS, MU, KLAC). Don't miss this one and come crying to us a year from now that you could have bought Ascend when it was $25. You have only yourself to blame.
