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

To: craig crawford who wrote (17074)	6/8/1998 12:33:00 AM
From: Mang Cheng	Read Replies (1) \| Respond to of 45548

I have changed the fair price for asnd to $30 because I didn't realize it is $47 right now ! Craig, short asnd, what do you think ? p/s ratio is a function of net profit margin. I think coms is worth a p/s of 2 right now (the market is very efficient). Since its net profit margin is low temporary. Once the street see that its net margin can go back to around 10-12 %, it p/s should be back to 3 (that's $40 based on current price level). p/s is also a function of earning. If coms can double its earning without increasing net margin (since net margin is hard to increase for low end company like coms and you don't need to increase margin to increase earning), let say it can make 50-60 cents per qtr, then coms p/s should go to 5 and that's around $67. With some overbought it can go as high as $75. Of course, it's based on either an increase in net profit margin or an increase in earning/share or little bit of both. Mang