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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: Ron B who wrote (6204)	12/3/1997 5:08:00 PM
From: Edward Leinbach	Read Replies (1) \| Respond to of 42804

The overall climate of the market has changed . That is why we saw 39.26 on Sept 26 & now 25 on Dec 4 . The past few year have seen a general bull market for technology stock with intermitten mini-bear corrections of various sectors at various times. Yesterdays market traded on hope. Todays market trades on reality. The multiples that investors are willing to pay for a given stock have drop substantially due to the removal of over-optimisism & a general sense of uncertainty about what lies ahead. Example : why did asend comand a 80 multiple a year ago & a 20 multiple now? Glad to see we are no longer trying to claim that MRVC has a 100% growth rate , as has been the case previously. Reality has set in a bit. Companies do not grow 100% year over year continuously . Demand for tech devices will remain high for many many years to come. What we may have now is a bit of hyper-competition . Too many companies chasing the same demand . This pushes margins lower & eps lower. Also manufactering is so efficient nowdays that actually less companies are needed. Some of todays companies won't be around 10 years from now. Even Intel now has a host of competing worries to deal with. Microsoft is the only pure play on PC demand since they have achieved a complete barrier to entry ( windows ) . Investors should adjust their thinking & expect a lower return going forward for a while . Jeff great timing on your recent entry . Solid company , solid management , great industry . If MRVC grows 30% a year for the next 3 years anyone buying around this 25ish level would do great. Don't expect to see 35 by January , as someone said. Times have changed. Too many traders nowdays - everyone thinks they can make a grand a week off the market , from brother Joe to aunt Lucile to uncle Charlie. Hold on tight to good companies & settle for 25% a year. That way you can double your dough every 4 years . Not bad.