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Technology Stocks : Check Point Software (CHKP) -- Ignore unavailable to you. Want to Upgrade?

To: BOGEY MAN who wrote (1797)	3/16/1998 11:23:00 PM
From: Danny Chan	Respond to of 7150

First bought CHKPF last Aug, bought some more in the recent sell-off and now my largest holding. So far, I'm very satisfied with the stock performance last year and there is a lot of upside potential to go. Among the four sectors that I vote strongly for the next 5 years, networking security companies has the best valuation. About CIEN, I have been watching it for quite a while and didn't really buy anything. While today's announcement appears to solve the revenue problem (they will make 600m for 98), there is no earning revision. Zack still shows a mean estimate of 1.45 for 98. Correct me if I 'm wrong, but I heard the management indicated about the 98 operating margin in the last CC to be in the low 30s due to price competition, much lower than 47% in FY97. The 1.45 estimate is still based on 41% operating margin. So I'm still a little bit nervous to buy. Well, who knows, may be it will come out ok. But there are plenty of opportunities out there. Two companies that I'm watching closely are: SMOD and YURI. I have a small position in both. SMOD certainly has an excellent valuation here. The company was caught on a recent CM down trend. Overall, I think DRAM price will not hurt them much since they make modules rather than chips. Price cut in modules will go back to chip manufactures like MU. But increasing volume demand will be positive for SMOD. SMOD also has an excellent business in Flash cards, same as SNDK, but at a much lower valuation. YURI has shown a very good technical pattern recently. Traded at a very similar pattern in the past to AFCI, I feel a break out coming soon. Hugh short interest on YURI is definitely a plus at this point.