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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: paul who wrote (10496)	7/17/1998 4:15:00 PM
From: Xpiderman	Read Replies (1) \| Respond to of 64865

SUN MICROSYSTEMS (SUNW) and MICROSOFT (MSFT). Two excellent earnings reports from top companies that also compete with each other. SUNW and MSFT each beat earnings estimates by 2 cents. After the close Thursday, SUNW reported fourth fiscal quarter (Jun) earnings of $0.73 per share, two cents ahead of expectations and up 20% from the year ago $0.61 earnings per share as revenue rose 16%. SUNW has been held back in recent months in part because of concerns about competition from Microsoft and concerns that Asia might cause it problems. Not so far. Even with the recent run in the stock, SUNW trades at a relatively low valuation. They have good management and solid, steady revenue growth. SUNW may have further to go. Microsoft also reported earnings 2 cents ahead of expectations, with fiscal fourth quarter (Jun) coming in at $0.50, up from the year earlier $0.40 as revenue rose 26%. Exactly what the market has understandably come to expect from MSFT - performance. In after hours trading, MSFT was down 3/4, but it has to be remembered that the stock has surged this month and it is normal for MSFT to beat the published estimates. MSFT did make some cautionary statements. They said earnings would be down sequentially next quarter and revenue growth in fiscal 1999 would be less than the just concluded fiscal year for 1998. This may take some of the air out of the stock short-term, but even with a few bumps ahead, MSFT can maintain solid earnings growth given their market position and margins. While MSFT and SUNW reported similar numbers, valuations obviously differ. On a per share basis, SUNW's profit exceed MSFT's, but MSFT stock is over twice the price. MSFT has a nose-bleed level price/earnings ratio, but it deserves it. The solid earnings numbers for these two key companies will help keep a positive tone in the tech sector. per briefing.com Anyone has any brokerage research report on SUNW? Please post them. I am expecting more upgrades and earning revises to come next week