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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: Sawtooth who wrote (5176)	12/9/1998 4:23:00 PM
From: BI*RI	Respond to of 21876

I'm with you both. ROE when compared to other Techs doesn't support the current price. Look at CSCO, EMC, DELL #s and a case can be made for their P/Es based on Revenue Growth, Earnings Growth and Total Return, and Margins which are far superior to LU. Even TLAB looks much better when you compare fundamentals. Yeah, LU has gotten many contracts, but their capital expenses to fulfill them will be great. Sure they can use their cash, but that doesn't necessarily add to total value. Profit margins will be a key to success. So far they haven't been great, thus economic value added (EVA) isn't so hot yet. Consequently, I'm with Haim and think we're overvalued here and am also waiting for a pull-back to more realistic levels. Before the most recent rise, I had set a target of 74, which is about a 50% retracement to the most recent low (57 from 90). Marc