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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: SHW who wrote (11231)	12/2/1997 9:47:00 PM
From: Sabrejet	Respond to of 45548

your conjecture that assumes the insider knows better than me is inaccurate, like your math. is your degree in something valuable or guesswork? with the bits of information from the cc and knowing inventories will be reduced drastically and from other thread some people spreading ideas that whole divisions have been laid off, tell me, in your opinion, how will all of this affect the bottom line? will it increase or decrease earnings? and do you know the future rev's to support any guesses you have??? old news and am expensive reaction by those after hours. sz

To: SHW who wrote (11231)	12/2/1997 10:16:00 PM
From: Merrill Ericson	Read Replies (2) \| Respond to of 45548

Would you buy COMS for $30 if you were told that $1 was the estimate? <Assuming COMS make $0.09 this quarter, maybe $0.20 next quarter, hopefully $1.00 for the next four quarters. Would you buy COMS for $30 if you were told that will be the new estimate?> Simple answer: YES! Reason: Well, if you take a value approach to investing (which I do) and you historically look at the growth rate of COMS, you will see that it has been greater than 30% per year. Also you will notice that over a 10 year history they had a bad year now and then, but evenutally come back to average better than 30% growth. A good rule of thumb to use when taking a value approach is to buy stocks that are selling at a PE at or below their growth rate. So, if I was told that the number was going to be $1.00, the price is at $30 and the growth rate is > 30%, I would definitely feel it is a buy. Don't forget to take into acount that in the past the company has encountered difficulties and management has always been able to recover to bring the growth back to the 30% level. Management hasn't changed, they have always been able to adapt in the past. Of course, past performance is not indicative of future performance, but that is where the risk factor comes in. Sure, the shorts may be right for the next few weeks/months, but networking is here to stay, and in the long run, my money says COMS will come back fighting and recoup its lost ground. Of course this is all IMHO. Time (future) will reveal who wins and loses. Time (past) can only give a picture of what may come.