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Technology Stocks : PairGain Technologies -- Ignore unavailable to you. Want to Upgrade?

To: Mark who wrote (25526)	8/24/1998 11:04:00 PM
From: Rainmaker	Respond to of 36349

Their Falcon chip was their flagship introduction. From this, PAIR will help bridge the gap between the high speed data travel in the street and your computer. It's safe to say no cable company will string fiber directly to your home and the telecos will not upgrade the wire the in the street. A high speed modem and ADSL is the viable solution. Their alliance with Rockwell (largest modem maker) and Harris (leading chip maker) will prove a winning combination. Look for news in upcoming months. WRT lack of product innovations from PAIR, I agree. They have a limited product line. But if you look at who they primarily serve, you can understand and maybe appreciate the limited profile. PAIR provides equipment to the telecos. And the telecos have not changed in over a 100 years! Accordingly, there have been almost no need for new types of equipment. The moving shift towards data delivery (and competition from cable) is only NOW forcing the telecos to look at new equipment (for ADSL). PAIR offers new and improved models instead of new equipment. What they make are the best and extremely reliable (what the telecos DEMAND). These guys are obsessive - perfectionist to a fault. The recently missed earnings and share price drop is clearly attributed to the pricing war. The war has ended. This is the result: Westell is severly wounded, saddled with millions in debt (expected to be profitable by 2000; Adtran has $50M in debt and NO ADSL! PAIR still made over $10M in 2Q; plans are in place to rollout ADSL products (to the telecos!); and they has over $200M in CASH. These reasons alone proves tempting for ANY company wanting to buy them out. It's no wonder Strauch is holding out for a purchase price in the upper 20s (with rumors at 32). We will see this soon as the consolidation heats up in upcoming weeks. Your wish for 15 by December will be fulfilled. IMO, before mid October. But I think you should ride out the wave with us LONG folks and hang out at the beach party afterwards.