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

To: Thomas George Warner who wrote (7823)	11/24/1997 1:43:00 AM
From: Pierre-X	Respond to of 11057

Re: Gurian and Frank Gurian likes WDC's busting into the enterprise market -- I agree here. There's money to be made in this segment. Gurian states that WDC has completed transition to MR. Debatable, considering WDC only just began shipping MR product in volume as of 1Q98. According to conference calls they wont be majority MR until 4QF98. Thats after accelerating transition. Gurian states that increasing seg-0 sales are good for WDC. I disagree. Increasing seg-0 sales mean skewing unit volume toward lower capacity points where Fujitsu rules. As far as "...compound annual growth rate 19% for the hard drive industry through the year 2001." goes, I always ignore forecasts going out more than a year. Analysts dont know sht about whats going to happen in 2001. Stock repurchases are good. Low debt is good. Increasing market share is good, but share growth is unlikely to continue in this environment. Gurian does NOT address the VERY RELEVANT issue of whether or not there is overcapacity in the industry. In a pseduo-commodity market, isn't this the most important issue? Frank also dodges the supply side issue. He focuses on currency fluctations and stable PC demand. Demand is not the problem. Also Frank has old info "Western Digital...is now likely to earn $3.40 a share in fiscal '98 (ends 6/98)"*. Once again, the company guidance is for $1.50 to $1.70 in F98. Quite a drop from $3.40. PX