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Technology Stocks : Western Digital (WDC) -- Ignore unavailable to you. Want to Upgrade?

To: christopher d licata who wrote (8665)	2/2/1998 8:10:00 AM
From: Jonathan Bird	Read Replies (2) \| Respond to of 11057

as an investor, you must be out in front of the knowledge curve. I believe I am. You know that analyst that upgraded SEG and sparked this rally? I read where someone asked him if he thought the current down cycle was over and if SEG had bottomed out. He said he didn't know if it was over or not just that the stock looked cheap. The very analyst that is leading the charge on this rally admits he doesn't have a clue! All it takes is one idiot analyst and 100,000 momentum players jump in. but, the industry is always growing and the competitors are not nearly like 5-7 years ago. the dd sector is becoming an oligopoly with the top 5 companies running the show. What you are saying is what people were saying back in July as to why the cyclical nature of the industry was no longer dangerous. Why are you saying this now? Its being proven right now that having fewer players in this industry hasn't helped a darn. I have read that this is looking to be the worst down cycle in HDD histiory.It appears that when you have many, but weaker, players a down cycle is quicker to shake some out so things can get back to normal. But when you have a few, but strong, they are to strong to shake. This could drag out for a long time before we loose one of the "Big 5." An Oligoply is only benificial if the players tacitly colude through the sending of price signals and don't try to gain market share. Fujistu and Maxtor have doubled production from a year ago. Aparently these guys weren't there the day the club took the oath. the wdc market cap is about 1.7 billion. no debt. great products. great positioning. ill buy and hold for as long as it takes. It could take a while and WDC knows it. They have a new credit agreement now for a "secured" 250 million. When the analysts on the CC asked about this management said it was to give them more versitility or some such nonsense. Wanna know they they couldn't say? That it's a borrowed war chest! The old agreement was for "unsecured" 150 million. WDC is in the worst position of all the 3 US HDDs. Their bread and butter is in the desktop which is now so commoditized that Maxtor is going to handily swipe WDCs share. Now that you know there will be no reason to post here in six-nine months asking what went wrong. ;) Jon Bird