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Technology Stocks : Dialogic ready to soar, funds buying -- Ignore unavailable to you. Want to Upgrade?

To: GuinnessGuy who wrote (527)	1/14/1998 10:42:00 PM
From: Jay M. Harris	Read Replies (1) \| Respond to of 674

Craig, I have become very concerned with technology companys like Dialogic that have a large percentage of their revenues comming from the pacific rim. As you know, many tech companys have recently reported disappointing earnings and I'm afraid that Dialogic is vulnerable to a slower growth rate in 1998 than my prior estimates. I am in the process of revising down my 1998 growth rate for DLGC given the uncertainty of the far east and DLGC's exposure. The stock has clearly been weak, and I have moved to cash to ride out what I believe will be a very difficult market for small cap tech stocks during the first half of 1998. Craig, since my last post I have seen a number of earnings shortfalls attributable to foreign trade that make me believe my $1.83 for DLGC in '98 is way too high. I'm sorry for flip flopping on this number, but fundamentals are deteriorating very rapidly in the far east, including Japan. My feeling is that $1.50 eps on 1998 with a 25X P/E for a $37 dollar price represents fair value. However, the street is currently modeling higher EPS for Dialogic which leads me to believe further downside is possible. I'm in the middle of earnings season and will post further information as it becomes available. Hope this helps, Jay