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

To: matt fahy who wrote (19440)	7/20/1998 9:38:00 PM
From: joe	Read Replies (1) \| Respond to of 45548

To All: Here's something I read a few days ago that I thought was relevant to COMS's problems. investor.msn.com Jubak's Journal How to play the earnings game. If stocks' behavior amid quarterly reports and estimates seems confusing, you're not alone. Make sense of the madness by finding the moves that matter. By Jim Jubak ... ... ... 1. The market is sticky. Analysts don't change their minds on a stock -- especially a big-name stock -- easily. They have long-term relationships with management that incline them to see the best in a bad situation. They've put clients into the stock, which makes it tough to admit a mistake and change course. So the market is capable of absorbing a tremendous amount of bad news without punishing a stock. ... ... ... ... That stickiness works both ways -- it also means hesitancy to change views of a beaten-down company when it starts to report decent news. For example, Seagate (SEG), a disk-drive maker that's followed bad quarters with worse, recently beat Wall Street estimates. Operating margins rose for the quarter, and both revenue and margins seemed headed upward for the next quarter, the company said on July 15. Granted, the company isn't out of the woods -- sustained revenue growth is by no means assured. But the market basically ignored the good news in the report -- Seagate's shares fell more than $1. The stock has burned so many institutional investors that it would take a very tough and secure analyst to recommend shares now. The company will have to report unambiguous good news for several quarters to earn its way back into favor. ... ... ... ...