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Technology Stocks : Applied Magnetics Corp -- Ignore unavailable to you. Want to Upgrade?

To: fut_trade who wrote (10477)	11/22/1997 10:06:00 AM
From: steve goldman	Respond to of 12298

Hey All! I figured I would drop in see what was going on in here. I have recently been getting interesting in the hard drive co.s and it has been anything but a non-volatile few weeks. This thread seems to be a butting of heads between the longs and shorts. I don't APM but I would make the following -cautiously optimistic points about the stock: 1. The company has a good balance sheet and has made good money as recently as a few weeks ago. I would personally always rather own a company with good earnings since that cash can buy whatever technology they need to get back up to speak. With xxx millions in profits, they can ramp up their production, get the right hardware and personnel. 2.This company has maintained its focus on older style heads as this is the greatest percentage seller in the industry. They have tried to maintain market share and profitability in this area. They clearly made amistake misguaging their efforts into MR heads. They paid the price ; they were 60 and making $1 and change a quarter and now they are 17ish making .65 for the quarter. 3. Hard drives arent' going anywhere 4. WDC, regardless of pricing pressure, unlike seg, has an increase in hard drive shipments for this next quarter of 6.5 to 7.5 million, a nice increase in units, albeit with lower margins. 5. Micropolis and other small companies wil be taken out and consolidate. The hard drive cos are well managed by top notch professionals (they aren't like some of these tech co. with 10 million in sales). which will remedy the overcapacity. 6. QNTM just shut a plant seg has restructured as well. The first step in any corrective phase in acknowledgement and promoting change. 7. APM is now firmly committed to being a player in the MR head are. 8. The hard drive arena is huge enough for a few players. 9. IBM - last I checked, not too many 8,9 gig scsi drives come in stock pcs especially those that sell in great volume, the market share, APM's arena. 10. There is a huge short interest, one of the biggest on the big board. Stock is now in hards of stronger holders, those who know and accept the current environment. Shorts, though, just like bulls are pigs at times, waiting for the last dollar. When this stock turns, it will turn significantly and the shorts will move it higher. Nonetheless, I am not whitewashing the comany but am fully aware of the problem it faces. Yet you have to decide what kind of companies, in what industry you want to face. Densities? meaningless, they will make those changes easy....They have .65 in earnings for each share to make these changes. Heck, own both rdrt and apm and you have the bases covered. forget IBM, i would only guess this hard drive area will provide very little to their bottom line and their only effect is how much it effects the bottom line of the other hard drive cos. Regards, steve@yamner.com