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Technology Stocks : Adaptec (ADPT) -- Ignore unavailable to you. Want to Upgrade?

To: Adam Weiner who wrote (3812)	10/3/1998 1:07:00 PM
From: Spartex	Respond to of 5944

Adam, Thanks for a job well done in encapsulating ADPT's situation. In fact, the detail you have provided proves very useful to me in evaluating ADPT's future. I appreciate your time and effort in illuminating your experienced thoughts on this company. <<Trouble is, as a Billion $+ company, its not easy coming up with products with 100 million+ revenue contribution. RAID products are a natural fit for them, but to date their offerings haven't been competitive (from a technology perspective) with established players in the market, such as Mylex, CMD, and AMI. Also, its not helping that Qlogic its eating their lunch in fiber channel.>> In fact, my current holding Novell, has gone through a similar washout period as ADPT is currently. The company went the wrong direction multiple times, and evenually Eric Schmidt was hired from SUNW to take charge of the company. Its in much better shape today, with lots more focus on networking, inter- and intranet software, its core engineering base. But I agree, growing topline revenue is a difficult process in a highly competitive environment. As you probably know, MSFT NT4.0 and their marketing machine has put a big dent into Novell's existing sales of NetWare. Nonetheless, if I decide to sell some of my current NOVl stock, I'm looking for other beaten down issues that have regained solid management, and have some product vision and pipeline in place going forward. Eric Schmidt was the single most important reason (besides 1 billion cash, and installed base) I got into Novell last Dec97 after I realized that its stock price had hit rock bottom, and the path of least resistance was up. Schmidt's been an impressive CEO and technologist IMHO. All the best on ADPT! I know y'all certaintly need it. Regards, QuadK

To: Adam Weiner who wrote (3812)	10/3/1998 3:28:00 PM
From: Starowl	Read Replies (1) \| Respond to of 5944

Adam: Thanks for the succinct and on-the-mark summary of Adaptec's current situation. Regarding your comment on needing a top of the line RAID product, the interim CEO Boucher hinted at that in the September analyst conference call, claiming that the company would very soon make an important announcement with RAID. Words are cheap and obviously even the cheap words did not impress the market. But we will see about his money and his mouth and judge for ourselves. Until the company can actually SHOW it has turned around, if it does (and I still believe it will), even at this extremely depressed price it is unlikely to attract new investors. Especially as it continues to slide. But the volume is very, very low. Not long ago the average daily volume was in the neighborhood of 2 million shares. On Friday it lost a chunk of percentage points at less than a million shares. A new product announcement is not likely to make a dent in the share price at this point, unless the product represents the new technology you mention. The company has to come along with a near-revolutionary product/technology to start the stock on an upward trend. An announcement of a marginal improvement in one of the standard adaptors won't cut it with investors. Beyond some revolutionary product, Adaptec at the very least has to demonstrate it can regain its former levels of growth. It is very difficult for me to see how that can come about in less than six months. The extreme changes instituted by Boucher, Adler and the board over the last two months are difficult for me to gauge in terms of the cost savings and future margins. So, who can say when, how, or if there will be a turnaround. Also difficult to gauge are the future benefits Adaptec will/may accrue from its equity holdings in Chaparral Technologies, Jaycor (JNI) and BroadLogic. Many uncertainties, and uncertainties aren't worth anything in the market, where money talks; BS walks. Starowl