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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: lin huan chen who wrote (14541)	3/20/1998 4:12:00 AM
From: craig crawford	Read Replies (2) \| Respond to of 45548

<< The following maybe is the reason why BAY went up but ROK went down on bad news: Short interest BAY from 2/20 5,381,175 up 50% to 3/19 8,119,091 >> Tell me about it. I was short BAY just before they pre-announced. Everyone and their grandma could tell that BAY was going to disappoint. Smart money covered BAY on instinet or early the next morning after the news was released and it reopened. People are so attached to COMS thinking it's a close second to Cisco (not!) and it's done absolutely nothing for the last year and a half so that maybe, just maybe, all the pathetic news is priced in. Only reason I'm not short this instant. I mean, who hasn't figured out by now that COMS is one big disappointment? Anybody with a weak stomach should have fled COMS months ago. All that should be left for sellers is shorts and people that have been asleep for the last 6 months. There are plenty of bottom fishers out there looking for stocks that haven't participated in the rally and COMS is the king of not participating in the rally. Dow up 1200-1700 points COMS does nothing. When everyone knows COMS is a dog there is only one way to go---UP. I still wouldn't waste my time going long this stock though. I would buy it after the bad news is all out. So many other better plays right now than COMS.

To: lin huan chen who wrote (14541)	3/20/1998 11:43:00 AM
From: joe	Read Replies (1) \| Respond to of 45548

lin huan chen, I think you are on to something. BAY went up after bad news because analyst gave it a buy signal (or some positive support), which I think scared of shorts. I think that a lot of COMS low price is because of heavy weight of shorts. I get the feeling they're like vultures over this stock. I think COMS will barely make earnings, and market is looking for excuse to push anything up. BUT, it is possible for COMS to go down more - it would have to be on STRONG negative news. A lot of negativity has already been priced into stock so dubious news will probably just maintain the status quo. So, if management can give stock holders any sign of improvement, then market strength and others will push stock up. If strong negative news, it's possible to see stock in the 20's. I personally hope not. I'm long for the VERY long term. I like their expansion into Europe with Siemens. Hopefully this is not a lot of hype. I agree with COMS modems being superior over the competition. I read the BOARDWALK article and was impressed. But, I agree with some that the modem competition is more intense in 56K upgrade compared to past upgrades. Then again, hopefully more modems (volume) will be sold than ever before. 56K modems are the only reasonable (price wise) hope for quicker internet access for the average joe for the next year or so. My concern, is that ISP's and consumers are somewhat wary of all the standards problems, and will make transition into 56K V.90 slow - thereby slowing COMS earning growth. We'll have to wait and see on this aspect. Also, COMS is more than just a modem company. More products are in the pipeline. But sounds like IT departments have been swamped with new technology and need time to sort out their decisions. This may further slow network buying - hopefully just a short term thing. So, yes, there is reason for negative concern, but more reason for positive outlook. Some shorts (IMHO) are outdoing the negativity. I wouldn't want to place a bet on COMS short term, but I think COMS will be OK for the long term. About their accounting problems. I not sure how much of a screw up that was. My understanding is that they didn't do anything illegal. I'm not an accountant, but it seems like negative hype is over done. If you take Herb Greenberg's position (on TSC), sure it doesn't look ethical. And sure, the SEC convinced them to rearrange their numbers. But Herb has somewhat made an example of COMS because he knows that this type of thing is done VERY FREQUENTLY. Analysts have seen this many times. They're not school children - they know it's part of the game. They don't like COMS doing it, but what they really don't like is that it appears that COMS has lost CONTROL of their business. Most important to analyst is to make sure that COMS has future earnings, not that it's a 'nice guy'. Either way, it seems like the SEC has caused them to tow the line, and at some point, negative analyst will not be able to carry a grudge forever. COMS knows they're under the microscope, so they'll probably go out of their way to avoid any kind of suspicious looking accounting disclosures. IMHO, they already seem to be more communicative with Wall Street, and seem to be trying to cover their butts more. I think this is good. So, on to the future question - will COMS products have a profitable future in the network sector. -Joe P.S. Where do you get your daily short quotes?