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Technology Stocks : Adaptec (ADPT) -- Ignore unavailable to you. Want to Upgrade?

To: Johnathan C. Doe who wrote (2421)	5/28/1998 7:25:00 PM
From: Starowl	Read Replies (1) \| Respond to of 5944

In the for-what-it's-worth department, I saw the following news service article yesterday perhaps of some interest here. The article was attributed to Sheila Muto, staff reporter of The Wall Street Journal and examined investments of a couple of California politicians, one being Representative Jane Harman (D), whose holdings were described as "more broadly diversified with a bit of sizzle". Ms. Harman's husband reportedly holds a trust for his wife. The article notes: "The recent meltdown of once-highflying Adaptec may offer investors a chance to pick up some shares for a good price. Just last October, Adaptec was trading at about $54 a share. But, lately, the company has suffered setbacks in its two main business lines: Revenue from its disk drives (huh?) and host adapters has fallen, analysts say, as market pressures have forced down prices. What's more, demand has slackened for Adaptec's equipment as corporate customers sink their resources into grappling with the Year 2000 bug instead. (Really?) "And having missed Wall Street earnings estimates for the fiscal third and fourth quarters, Adaptec is now trading around $17 -- making it an enticing time to get in, according to Michael Murphy, editor of the California Technology Stock Newsletter in Half Moon Bay. (Adaptec's fiscal year ended on March 31.) The company has "had problems" trying to generate business before, Mr. Murphy says, but it has "always been able to solve them quickly" by, among other things, introducing new products. Assuming such improvement happens again this time, he adds, investors "can really turn" Adaptec's latest missteps "to an advantage." Indeed, he sees an opportunity to buy shares of "one of the best" tech companies "very cheap." "Mr. Murphy, who manages three no-load technology funds, says he plans to build up his own position in Adaptec this summer after results for the first quarter--traditionally a slow one for the company--are announced. "John Rossi, a managing director in research at BancAmerica Robertson Stephens in Menlo Park, agrees that the key for Adaptec will be developing a new product. The company "really needs a third leg for the stool," he says. Although Mr. Rossi cautions that the company has "not been under this stress before" in terms of finding its next market, he still has a "long-term attractive" rating on the stock. And patient investors who stick with Adaptec for a year, he predicts, could see upside of as much as 40%." Again, just for what it's worth. Starowl