Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : HDCO - Why sudden dip? -- Ignore unavailable to you. Want to Upgrade?

To: James Burke who wrote (397)	3/18/1998 5:11:00 PM
From: Douglas V. Fant	Respond to of 572

James, Agreed it may go lower- but it's a rational bet at this level for a value investor- we are at the last four months or so's support level. If you look at HDC's customers, then you will see that HDCO derives 32% of its revenues from computing companies including Compaq (that part is currently bad as Compaq moves excess inventory), but also 34% of its revenue from telecommunications- Lucent, Northern Telecomm, etc. HDCO is as much a bet on telecommunications as it is the boxmakers.... Sincerely, Doug F.

To: James Burke who wrote (397)	3/18/1998 5:26:00 PM
From: Paul Senior	Read Replies (1) \| Respond to of 572

Can't see it going lower, eh? Well let's see. Over the past few years the pe has been averaging mostly around 10. You've seen that the low earning est. this year is for 2.8 with the mean about maybe $4.00. But that mean est. implies a very high -- at the higher range ROE. Based on historical values, it's not unreasonable to expect a $2.50 estimate IMO. For me, I'd be willing to guess at this point that most of the Zacks' analysts are closer to reducing their estimates rather than raising them (I'm not predicting what any analyst will do though -g-). We already might also have a concern about how well the integration is going with Zycon -- some postings have reflected this. So the value added this year by the acquisitions is iffy IMO. I can easily see HDCO selling at 25-28. Did you notice also that now we are seeing some further evidence of executives selling (although at much higher prices from today's)? Lest I scare anyone out of the stock -g-, I'll add here that I am a buyer today, was a buyer yesterday, and a buyer the day and week before. For long term investors, it's reasonable to assume higher prices from what we are currently experiencing. That's my bet anyway - and I've been wrong many,many times before. Paul Senior