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Technology Stocks : QUANTUM -- Ignore unavailable to you. Want to Upgrade?

To: Zeus549 who wrote (6082)	12/4/1997 10:51:00 AM
From: John A. Shaffer	Read Replies (1) \| Respond to of 9124

Lee, I still think that the selling is related to tax losses. Anytime you get a stock that has gone down as much as QNTM has, tax loss selling becomes a good way to offset gains on other stocks. This should be over in a few weeks. Regards John

To: Zeus549 who wrote (6082)	12/4/1997 3:39:00 PM
From: Rob S.	Read Replies (2) \| Respond to of 9124

Quantum has been consistent in what their "guidance" has been and part of the guidance is that there is some impact due to competitive pressures on the low-end DDs but not that much. The market is worried that price competition will continue to escalate. This type of competition has devastated the earnings prospects for WDC and SEG. Although there is reason for concern about margins in the low-end HDDs, that fear has now gone too far. I think what we are seeing now is the final unwinding of decisions by institutional investors and scared private investors to unwind themselves from the HDD sector. That unwinding has been pretty indescriminant. Contrary to being rational about it, many fund managers realy do not understand the specifics well enough to have felt comfortable holding onto QNTM. One fund manager once told me that he had about 30 stocks that his group was personally responsible for and he was not an engineer and did not have the time to figure out what technology or strategic position within a battered industry was superior - so he just ditched out of every company in the sector. When you own several hundreds of thousands of shares, selling them is often turned into the hands of a clearing group that must filter the stocks out over a few to several days. I think we have hit bottom. Today we had a brokerage downgrade from strong buy to buy. Quantum has been devastated recently with no direct news out. Now that we have some, it probably looks at lot less scary than the imaginations of investors have built up. One rule for investing is that the stock/market is often near a top when it has moved up to high valuations and good news no longer has any noticable effect (think back to good earnings report, new OEM wins, etc. when QNTM was over 40). Conversely, the stock is near a bottom when it has reached low valuations and bad news has little or no effect. At either extreme, market expectations have already been built into the price and the pendulum has swung to the point that it takes an increasing amount of presure to keep it from changing momentum.