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Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: DavidG who wrote (36316)	7/16/1998 2:34:00 PM
From: Bipin Prasad	Respond to of 53903

MICRON ELECTRONICS INC. (MUEI) 14 5/16 +13/16. Direct marketer of PCs is being asked to become a sprinter rather than a marathon runner, while it continues to slash prices on its desktops. The hope is that better operating results will emerge from continuing continuing cost reductions, while expanding its sales volume. Since a new CEO was appointed last quarter, the company has been able to post an improvement in margins as Joel Kocher has been doing away with excess that is not in keeping with a changed PC industry that relies of leanness. In fact, given this week's announcement that Micron is again lowering price by as much as 10%, it is hoped that an increase in sales volume will make up for the loss in revenues. To be sure, Mr. Kocher is keeping the heat on personnel by operating more efficiently in order to improve operating margins. The news of the price cuts and tight rein on expenses has enable the stock to improve in the past weeks, reversing a trend that has seen the stock fall from a high of $21 in September of last year. In fact, the improved outlook for cost containment has prompted Dan Niles of BA Robertson Stephens to upgrade the stock from long-term "attractive" to "buy." While Mr. Niles gives credit to Mr Kocher for focusing on margins on computers, he expects that further gains will allow Micron to realize a 6% operating margin sooner than anticipated. In fact, Mr. Niles feels that Micron is experiencing stronger unit growth and that costs reductions will start yielding better operating results. If so, then Micron will have converted itself from just another marathon retailer of PCs to a much leaner sprinter and efficient seller of personal computers.