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 : Stock Swap -- Ignore unavailable to you. Want to Upgrade?

To: Investor2 who wrote (13492)	4/29/1998 4:10:00 AM
From: Andrew Vance	Respond to of 17305

AV--Quite possibly since I was also invested in WDC in that timeframe<GGG>. I found this news release quite interesting especially since WDC is down $2 today and reported a bad quarter. Keep in mind that this is a real late night release. Those early risers that see this before the market opens may feel comfortable that a slight disk drive rally could be touched off by the early herd mentality looking for some refuge from the chaos<GGG> Tuesday April 28, 11:30 pm Eastern Time Read-Rite says industry bottomed in March SAN FRANCISCO, April 28 (Reuters) - Read-Rite Corp president Alan Lowe said that the disk drive industry bottomed in March, and he is still confident that his company will see 10 to 20 percent sequential revenue growth in the third quarter. ''I'm confident with our projections (that the company made on its conference call with analysts),'' Lowe told a Hambrecht & Quist Technology conference here. ''March was definitely the bottom.'' Lowe said that March was an ''ugly quarter'' for the disk drive industry, referring to a quarter that has been fraught with a glut of disk drive inventories, price cuts, financial losses and even layoffs at some disk drive makers. ''The level of inventory among OEMs (original equipment manufacturers) has been reduced,'' Lowe said. In its fiscal second quarter, Read-Rite, a maker of recording heads and head assemblies for disk drives, reported a net loss of $62.2 million and revenues of $187.1 million, a 34 percent drop versus the year-ago period. It may be appropriate to state that the Disk Drive sector has been on radar, you saw me prematurely getting into WDC, and I will be starting to make some small forays into this sector for the medium term. No quickie profits but rather positioning myself for some profits down the road. Andrew

To: Investor2 who wrote (13492)	4/29/1998 11:30:00 AM
From: Andrew Vance	Read Replies (1) \| Respond to of 17305

AV--On the WDC front, I forgot to add that I believe the 188-92 debacle has already been repeated over the course of the past months. The chart you link to is logarithmic but does exhibit the same slope recently. I do not think the correction will be as dramatic as seen back then. Back then there were many more Disk drive companies than there are today and the in fighting was horrendous. We are talking about the days of MFM, RLL, and early IDE technology in the 20-100 Meg range where business was gained and lost based on huge contract swings, pricing, and ability to get to the market first with a new higher density drive. A switch from 20 to 40 or even 80 Meg was a monumental effort and swung the fortunes of some of these companies. As you know today, the major focus is not really on drive capacity, IMO, since the average user hasn't figured out a way to fill a 12 Gig drive<GGG>. The focus is on the technology (TFH, MR, GMR)used to create these monstors, cut throat pricing, and speed of data transfer. There are less players in the game due to consolidation with WDC possibly the #3 or #4 producer. WDC has at least both Qunatum and Seagate to contend with and worry about. It would not surprise me to see another round of consolidation where WDC could fall prey to a takeover. I have limited visibility into the WDC organization. It appears that they are not as "fresh" as they can be and are scrambling a bit to regain siome of their luster internally. There has been some re-alignment of programs and projects which may be affecting their bottom line. I think we are looking at a company in transition and regrettably I wish I had waited another day or two before picking up shares. However, a little averaging down (keyword is a little) will have me poised for a recovery. As was pointed out on in the RDRT press release (posted last night), we might be starting down the road to recovery. With the 400MHz CPU systems hitting the streets (as well as the 350, 333, 300, and WinChip), you have to have some spiffy disk drives to put into those beasts. An "old" 8-10 Gig drive will just not do<GGG>. Andrew My apologies for the first short response. I was tired and had a plate full of stuff to do. I am trying to re-group and beef up some of the rather sparse posts from the past few days.