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To: JOW who wrote (692)	12/4/1997 4:38:00 PM
From: van wang	Read Replies (2) \| Respond to of 1229

not confident...i have 38 cents on 252.5 million sales...when we get closer...i believe analyst will revise downward...1998 will the year for SQNT not 1997...current mkt multiple valuation stands at 23-24X trailing earnings which puts SQNT at $20-22 using 88 cents for 1997 fiscal...but industry isnt growing as fast as SQNT so the shares are undervalued...using 10 yr DCF (27% 5 yr eps growth on 20% sales growth) gives $28 fair value...this is acheivable on conservative top line (industry is 23% for next five years)if SQNT hits 10% pretax operating margin by end of fiscal 1998 (expense control and sales productivity as mgmt said in conference call) remember SQNT needs time for the new people to become productive...second, the full blown version of NUMA-Q was only ready 1-2 mos. ago...the sales cycle is longer now with larger customers...for example, OXHP did anyone catch the HP strategic deal with Delta for $300 million..first HP doesnt a server that matches SQNT...however, this bundling better not become in vogue...or SQNT either gets taken over or they will disappoint people...we need to be careful...that was not a good deal for SQNT...everyone is looking to standardize their hardware ("simplify") cheers