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

To: Wigglesworth who wrote (22195)	9/24/1998 1:03:00 AM
From: Mang Cheng	Respond to of 45548

Good management review : "The availability of the CoreBuilderr 9000 platform is contributing to a surge in our pipeline of large, mission critical networks for large enterprises. We are working with dozens of these customers to prepare public announcements of these wins and a description of their new switched infrastructures in the coming weeks. " "According to the latest Inside Spending brand-preference poll from Computer Reseller News, "Midsize companies preferred 3Com by a whopping 36 percent, compared with 9 percent for second-place Hewlett-Packard Co., Palo Alto, Calif., and 8 percent for Bay Networks." " "Later this week, we will announce an important agreement with Motorola to provide them with the industry's first and only circuit-switched Code Division Multiple Access (i.e. wireless) data access solution, to enable digital cellular and PCS carriers to offer data services and become ISPs themselves. Our early competitive local exchange carrier customer, USA Global Link, is beginning commercial deployment this quarter. So is TCI for their Internet service over cable. Last quarter, we also won the TCI de Argentina business for cable modems and head-end equipment. Argentina is an interesting country in that regard as the cable network passes through more homes than the telephone network. We hope to be able to announce a few large VOIP wins with major carriers this fall. " " Our back-to-school marketing program, combined with the firm establishment of V.90 service among service providers, should ensure that the fall and Christmas season do not repeat the disappointing growth we experienced last year in this segment. " ........ "Finally, we'd like to thank those of you that are shareholders, and hope that you will remain so. " 3com.com Mang

To: Wigglesworth who wrote (22195)	9/24/1998 8:33:00 AM
From: FUZFO	Read Replies (1) \| Respond to of 45548

article from yesterday morning: THE DAY AHEAD: Despite revenue concerns, 3Com ready to rebound By Larry Dignan September 23, 1998 7:35am ZDII 3Com Corp. (Nasdaq: COMS) appears to have won Wall Street back -- and not just because the company is often mentioned as a takeover target. 3Com's better-than-expected fiscal first quarter <http://www.zdii.com/industry_list.asp?mode=news&doc_id=ZE202849&pic=Y> shows shares may be ready to rebound without an Intel Corp. (Nasdaq: INTC) or even a Lucent Technologies Inc. (NYSE: LU) as a potential suitor. Is 3Com back? But first the caveats. The company isn't growing yet, but officials are optimistic about future quarters. Notice how 3Com topped estimates. "Continued expense management and operational focus drove gross margin and operating income," the company said. A leaner 3Com? Yes. A growing 3Com? No. Wall Street isn't likely to split hairs over how 3Com topped estimates because the fundamentals are looking up. It's also hard to argue with the results -- 3Com reported earnings of 24 cents a share for the quarter, 4 cents better than consensus estimates. Revenue for the quarter was $1.4 billion down from $1.59 billion a year ago, but ahead of analysts' projections. Sales of systems, which include switches, hubs, routers and other networking products, were up 2 percent from the fourth quarter. Sales of client access products, which include network interface cards and modems, were up 3 percent. The year-to-year sales should be noted, but the sequential growth in a seasonally slow quarter is the cause for optimism. Look for Wall Street to hop on the 3Com bandwagon. Here are the reasons Wall Street is bullish on 3Com: Tis the season. Joseph Bellace, a Merrill Lynch analyst, said in a report that networking transitions and upgrades to faster modems could help 3Com. Modem revenue will get a second quarter boost from back-to-school and Christmas sales. Bellace projects industry modem growth of 20 percent. The small business-home office market -- 3Com is strong in the small business-home office market. As PC prices fall more homes and small offices are likely to have more than one computer, creating the need for networks <http://www.zdinfobeads.com/default.asp?module=insider&topic=Consumer_Market&story=HHPC_more_0922>. According to ZD Market Intelligence <http://www.zdinfobeads.com>, just 6.9 percent of households have 2 or more PCs with 44.8 percent having one computer. Operational efficiency -- The company has corrected its modem inventory problems and cut costs following a long slump. PalmPilot is a hit -- What started out as a toy acquired in the U.S. Robotics acquisition has turned into a moneymaker for 3Com. Michael Cristinziano, an analyst with Gerard Klauer Mattison said PalmPilot sales are expected to jump to $600 million in fiscal 1999, nearly triple the 1998 figure. 3Com is still a takeover target -- Intel buying <http://www.zdii.com/industry_list.asp?mode=news&doc_id=ZE202751> 3Com is quite a stretch because of regulatory hurdles, but other scenarios could play out. Cristinziano said Lucent could also become interested in 3Com. Cisco is playing in Lucent's backyard, so the telecommunications equipment vendor could encroach on the networking giant with 3Com on board. Another scenario could be splitting the company into parts with Lucent getting the high-end networking business, Intel grabbing the small office-home businesses and the modem business being jettisoned. The takeover talk is just speculation, but it's another factor to consider. "3Com isn't a Cisco, but that doesn't mean it's a bad business," said Cristinziano. TDAIN Source: ZDII