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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: The Phoenix who wrote (32780)	2/1/1998 11:13:00 AM
From: Gary Korn	Read Replies (2) \| Respond to of 61433

As far as the information above. Are these data fiscal or calendar? Calendar. If they're calendar how did you get the data? From Track On Line, a real-time quote system. It contains an historical database as well. But I knew closing prices 12/31/97 for both CSCO and ASND from the TrackOnLine dailing closing prices list that I print out. I don't think there is any question but that these numbers are accurate. Finally, as both you and I know much of ASND's business and a good portion of CSCO's is lumpy. A few big deals and you look like you're blowing away the market. Nonetheless, I agree that if ASND gets into consistent double digit growth the stock will do well. Also, again as both you and I know, they'll need to show consistency. A few good quarters will bring them up as much as 50% possibly, but they'll need perhaps 8 good quarters to get back to their all time high. Would you agree? The question is whether ASND needs 8 good quarters to get back to its all time high. Frankly, Gary, I'm clueless on that. (Not enough visibility, as it were). But let's make some assumptions here (don't hold me to these...I'm winging it big-time): ASND now has a market cap of 5 times sales. If sales at the end of 1998 are 1.4B (consistent with current projections), and if the market cap to sales ratio stays the same, ASND should trade at the end of 98 at about $35/share. The upside beyond $35 will be based on whether double-digit growth for 2H98 appears likely (as we get closer) to materialize. If that happens, the p.e. will inflate, pushing the share price up (maybe to the $40-$50 range). Anyway, that is 4 quarters gone. Now, assume 40% revenue growth in 1999 . That puts 1999 revenue at $2B. Keeping the same ratio of market cap to sales (5 to 1), that gives a year end 1999 price of 50. Still not the all-time high. But on the other hand, if a 40% growth rate becomes known, the market may inflate ASND's p.e. and there you have it, your 8 quarter figure to get to the old high of about 80 (pretty sharp, Gary)! Judging from Ashby's actions so far, he seems in no hurry to push the price envelope faster than is warranted. But, a lot could happen between now and then. Both positive and negative. And, at the moment, none of us has any visibility beyond 1998. Gary Korn

To: The Phoenix who wrote (32780)	2/1/1998 11:25:00 AM
From: Jan Crawley	Read Replies (1) \| Respond to of 61433

Good morning Gary(not Mr. Korn): RE: 8 good quarters to get back to all time high. From $30 to $80 in two years. That's good investment. Regards, Jan

To: The Phoenix who wrote (32780)	2/1/1998 12:49:00 PM
From: sepku	Read Replies (3) \| Respond to of 61433

>>>A few good quarters will bring them up as much as 50% possibly, but they'll need perhaps 8 good quarters to get back to their all time high. Would you agree?<<< I still believe my guess on Jan 1, that ASND will double CSCO's % returns for 1998, will easily hold true. And % returns is all that matters...unless you're an employee of either company and your job is linked to its ultimate success (or lack thereof). The analysts' outlook on ASND has finally tapered off from the overwhelming negativity since mid-July, and seems to now be neutral wait-and-see. With another good Q, sentiment should swing to the positive and ASND could easily see 50 within the year. Who would buy/hold ASND to it's all-time high? I sure wouldn't. 50 for a 50% return, and I'm out. Street sentiment on this stock waffles too much for my liking. I still say that between ASND and CSCO, ASND is the better investment of the two for 1998 -- that is, if you're looking for maximized returns. People looking for mediocre returns need not apply... Style Pts.