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

To: blankmind who wrote (18587)	7/2/1998 11:13:00 AM
From: joe	Respond to of 45548

>>but as companies cut prices on old technology, it is because they have improved the manufacturing (cut costs), and need not invest much r&d in the future of these products.<< I agree, and this is what COMS is saying also. They say that margins (by cutting expenses) will go down. Analysts liked hearing this. BUT, sales are predicted to be FLAT next quarter or two. (personally, I think they are lowballing estimates - both COMS and analysts) So, if sales will be flat next quarter, and modem expenses are lowered but offset by lowering prices (and therefore profits), this is a zero sum game. This is what analysts don't like and are worried about (imo). Not to mention that they are worried that 56K modems will be eclipsed by xDSL and Cable (of course, it didn't occur to these guys, that 3Com makes these products also)