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Technology Stocks : Applied Magnetics Corp -- Ignore unavailable to you. Want to Upgrade?

To: T Bowl who wrote (11923)	5/14/1998 7:13:00 PM
From: Stitch	Read Replies (2) \| Respond to of 12298

T-Bowl, Thread Here is Morgan-Stanley's assessment of APM's nearest competition for a relative read on things: Morgan Stanley & Co. Incorporated Report (5/14) - For those who like to trade disk drive stocks, this may be an interesting "value" play as we believe that the stock could return at least to levels somewhat consistent with where it was before the IBM/WDC announcement. However, we think that it is very important to remind investors that the risk level is very high, and about the long- term negatives - fear, uncertainty, and doubt remain. RDRT is not an appropriate investment for certain risk-adverse accounts, in our view. - From a valuation basis, RDRT's valuation can be cut a couple ways. On a P/E basis, the stock is trading at 10 times our C1999E EPS of $1.14 (vs. a traditional range of 19 to 7 when business is good). On a market cap/revenue basis the stock is trading at 0.48, which is the stock's lowest level since the Company went public in 1991, and compares to a high of 2.33, set in December, 1992 (the trailing 8 quarter market cap/revenue for RDRT is 0.89). On a price to book value basis, the stock is trading at 1.3 or 38% above its low of 0.94 from June, 1993, and down 68% from the high of 4.1 set in March and repeated in June of 1992. On a trailing 8 quarter basis, RDRT's average price to book value is 1.94, and the stock is now trading 33% below those levels. READ-RITE CUSTOMER POSITIONING Customer % of RDRT Position on RDRT Position on RDRT's Current Products Business - 2.5+&3+GB per Future Products - Platter Today 4.0GB+ WESTERN 50% +/- Fair to Very uncertain with DIGITAL improving IBM announcement QUANTUM None Not good but Could improve with potential 4.0+GB and/or Bigfoot position on positioning Bigfoot product SEAGATE Single Fair Could improve to 10% digit % MAXTOR 20%+ Not good on 2.5+ Should be stable to but better on 3+ better SAMSUNG 15%ish Good on 2.8GB, Same good on 3+