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 : INVX Innovex Comdex Winner !! -- Ignore unavailable to you. Want to Upgrade?

To: Box-By-The-Riviera™ who wrote (2687)	9/22/1998 11:32:00 AM
From: Beltropolis Boy	Read Replies (1) \| Respond to of 3029

joel. fwiw, excerpts from a lehman bros' HDD report follows. no specific citation of INVX, however, it does focus on SEG, so some may appreciate its relevancy. note that disclosure G applies: "The Lehman Brothers analyst who covers this company also has position in its securities." ----- Headline: Seagate Technology: Highlights from the Lehman Brothers Data Storage Tour Author: Kimberly Alexy, CFA 1(212)526-3141 Rating: 3 Company: SEG IBM MXTR QNTM WDC Today's Date : 09/15/98 Disclosure(s): G * On Day 1 of our data storage tour through Silicon Valley, we met with management and product team members from Quantum, Maxtor, Seagate, IBM HDD, and DAS Devices. * In general, demand trends appear to be tracking towards a seasonally stronger 3Q, aided by the completion of the PC inventory correction and strong OEM demand. * The high-end of the market remains strongest with most drive vendors noting that the pick up experienced in Q2 has sustained into Q3. * Pricing, however, remains aggressive - although the rate of price erosion appears to be slightly more modest than in the June quarter. * We are raising estimates for Seagate based on improved strength in the company's high-end business and continued cost improvements. We are maintaining our estimates for both Maxtor and Quantum. Investment Conclusion We continue to believe that at the current valuation levels and given the stronger unit volumes slated for the 2H, that the HDD stocks have short-term appreciation potential. But as the case with the past 9 months, we are not convinced that such gains will be sustained given the continued aggressive pricing trends in the industry. We believe that for sentiment to shift around the industry, pricing must stabilize. Longer-term, we believe additional consolidation or attrition is needed to improve the health of the industry. Near-term, drive companies remain positioned for a sequential improvement as a result of stronger nit volumes. In general, we believe the industry recovery will be more gradual than in times past. We continue to recommend Maxtor with a 2-Outperfrom given the company's stronger relative position as a result of desktop product leadership and strong OEM business. We believe that the HDD group will generally report in-line to modest upside results in their respective 3Q earnings results which will be reported over the next 4 to 6 weeks. International Business Machines (IBM, $129 1/2, rated 2-Outperform) Maxtor (MXTR, $8 1/2, rated 2-Outperform) Quantum (QNTM, $14 5/8, rated 3-Neutral) Western Digital (WDC, $10 1/8, rated 3-Neutral) lehman.com