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 : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: Father E. who wrote (50036)	7/15/1998 9:03:00 AM
From: Dennis R. Duke	Read Replies (1) \| Respond to of 61433

Well Sales are going to raise from $1.4 to $1.9 billion or 35.7(1428)%. Marketing cost will continue to shrink, margins holding and operating income forecast are to remain in the 25 to 26% range and improving go into FY'99. The Core Switching products are going to provide the majority of the growth and are more profitable than the Access products. So FY'99, given no negative earnings push, in fact there is a lot of potential improvement to operating income, should be at least a pass through of the sales growth. Therefore, $1.20 times 1.3571428 equals $1.6285713. So based on no improvement the company would beat the guidance of $1.60. But if the operating income improves by 1% that would add about 7 cents to that. So again Michael is doing the right thing and forecasting conservatively at $1.60. Joe Bellace sees what I do and raised his FY'99 forecast for Merrill Lynch to $1.50 to $1.70. That agrees with the above musings ($1.6285713 plus .07 equals $1.70). BTW, Joe also sees FY'98 as $1.15 to $1.25 as of this morning's ML research report. ML did not raise their opinion today. They only provided reporting of the CC and the increased estimates. Other questions, Dennis