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Technology Stocks : Western Digital (WDC) -- Ignore unavailable to you. Want to Upgrade?

To: steve goldman who wrote (7794)	11/22/1997 11:09:00 AM
From: Brian Lempel	Read Replies (1) \| Respond to of 11057

Steve, maybe you can help me with this QNTM plant closing. It is to my understanding that the plant made HGAs. How is this good for any of the HDD makers? It would seem to me that that would cause head prices to go up (great for RDRT and APM), which increases their costs! As far as being long these stocks, I am beginning to reconsider. I own WDC and APM, and am obviously deep in the red. APM may or may not have bottomed out. WDC is a much more solid company, but it is the one I am thinking about selling. Based on company guidance, WDC will earn around $1.50 next year. This negative earnings growth has got to weigh down on the stock to some extent. This may very well be the bottom, but with earnings like that, it is hard to imagine that WDC would make it up to $30. WDC is still a first rate company. I think this is not the bottom, and even if it is, there are better places to put your money for 6-12 months until this thing gets resolved. One thing I will be looking for is lower profits, but higher market share. Once this thing gets resolved, that will play a major role in future earnings. I am thinking about buying more CREAF. Also, does anyone know anything about RNBO? trading at 24, 2 times book and sales, 5.70 in cash and no debt. Brian

To: steve goldman who wrote (7794)	11/22/1997 8:21:00 PM
From: Pierre-X	Read Replies (3) \| Respond to of 11057

Re: Multiples According to Zacks: _ The 5 year average multiple for WDC is 11.6. The ttm high is 25 and low is 7. _ With expected 98 earnings adjusted to around 1.50, at Friday's close of 21 15/16 gives a 98 multiple of 14.6, a relatively rich multiple for WDC. It's not impossible for the share price to fall to 10 times 98 = $15. That's my target for doubling down. We still have a few more downward earnings revisions and perhaps downgrades to surface until all the analysts have arrived near the 1.50 number. These will continue to keep the share price down, while there is no imminent positive news. Year end tax selling could also add negative pressure. PX