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Technology Stocks : Novell (NOVL) dirt cheap, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: Joe Antol who wrote (20299)	2/25/1998 10:20:00 AM
From: bry57	Read Replies (1) \| Respond to of 42771

well the DOC. did it! Way to go novl. It would not surprise me to see a buy back for his next show, go DOC. GO bry57

To: Joe Antol who wrote (20299)	2/25/1998 10:27:00 AM
From: Matt Webster	Read Replies (1) \| Respond to of 42771

Here's a Dumb Idea... Why doesn't NOVL turn into a service organization? It can leverage its installed base, its network of CNE's and training centers and be the Paychex of network services. You know how PAYX does payroll support for a small fee per month. Well, we can have an army of Novell CNE's who go around and troubleshoot within a givin geographic region. Small business is scared to death of opening the Pandora's box of setting up the Internet for fear of it having to be maintained and upgraded and all, so NOVL can leverage its economies of scale and be a full service provider. This would increase revenue with higher margins. Forgive me if this has been covered on the thread already. Matt

To: Joe Antol who wrote (20299)	2/25/1998 6:47:00 PM
From: Salah Mohamed	Read Replies (3) \| Respond to of 42771

Hi Joe, Dwight, & Steve ... Q1 Results Eric Schmidt new word is that 'business is stable', translation: our sales declined to around 250M from 375M a year ago and we don't have a clue how to get it back up there, but we promise we will do our hardest to stay around these low levels. Several analysts asked about growth during the CC and the company would not commit to any growth, the magic word was 'stability', doesn't this sound a little weird in the explosive networking market?. The last 4 quarters revenues are: 273M, 221M normalized, 269M, and 252M, with an average of 254M. Quarterly revenues of 250M-260M seems to be their baseline. Seriously Joe, they are in big troubles, NW sales are about 148M (these were ~300M in 95, and were ~240M in Q1- 97), and all other products are losing grounds. They tell you about all these new products, Fast Cache, NDS on NT, ..etc., and then they tell you the reason the revenues were lower than last quarter is that they sold 12M less in Asia, aren't these new products suppose to make up for the short fall in Asia, if not more, provided that they are holding their grounds?. Unfortunately, I think they are getting killed by MSFT and I don't see a way out for them. MSFT controls the SB LAN market now, and with NT5 they will make strides in the enterprise market. About EPS, they did a good job by reducing their total expenses by about 10% from the previous quarter (to 247M from 273M), but don't expect any further significant improvement. It took Dr. Schmidt about 3 quarters to reduce expenses to make the company marginally profitable, this is the easy part, I want to know how long it will take to have this company growing again from these low levels. Yes, this is the easy part, it is all internal controls, the hard part is to sell your products effectively, and this hasn't happened and the previous 4 quarters sales numbers don't show even a hint of a turnaround. In my book, a turnaround means that you started to grow again. Another important point, I don't think NW5 (Moab) will save them, the same thing which happened with NW4 (Green River) will happen again, they will have one good quarter of sales and then it fizzles in the next quarter (refer to Q4-96 and Q1-97 numbers for NW4 fiasco). Without significant improvement in their marketing I don't see how they are going to come back. My best guess is that they will stay in this inert state for a long time and the stock will act accordingly, up and down between 6 and 10. As I said before, I do believe the stock is fully valued around 9. Some new guys in the thread think the reason that the sales are declining is that Novell got rid of some businesses, this is not true if you are comparing with last year numbers, one needs to go back to Q1-96 for the impact of divested businesses. Pure and simple, Novell is a company in decline in an explosive market it used to dominate. Regards Salah