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Gold/Mining/Energy : JDS Fitel -- Ignore unavailable to you. Want to Upgrade?

To: Hank Stamper who wrote (705)	2/4/1999 1:42:00 AM
From: Praxis	Read Replies (2) \| Respond to of 815

I agree that it will be very hard for JDS to maintain a mulitple of over 70 for a period of time. These valuations built in to these technology stocks are 'blue sky' valuations bid up by investors and the institutional players because: 1) Too much money is flowing into the funds, the anal-ysts are therefore putting it into whats hot and the prices get bid up, 2)the internet trading investors/retail are finding themselves with constant bombardment of how they must save so much to retirement, see technology companys as the future giants and the stalwarts of the new economy so they bid up the shares. When in fact most of these manufacturers are operating in what will be and is becoming a commoditized industry. JDS is an excellent company with an excellent future but what happens when these massive inflows of capital cease in the event of a downturn. The technology stocks have an average historical P/E multiple of 24 since 1985. I think the best plan with a company like JDS is to hold and possibly buy on the volatility that is sure to come. It's a great story as is ATI Tech. but just because it is growing well now, the 'blue sky' multiples don't have any room for errors which history proves are always around the corner in any company.

To: Hank Stamper who wrote (705)	2/4/1999 10:02:00 AM
From: pat mudge	Respond to of 815

2. Growth potential for the fiber optics sector over the next period appears to be very, very strong for all the reasons that have been discussed here. That is one of the reasons I bought JDS. However, as I wrote previously, very few companies ever sustain the growth of JDS over a longer period of time. This includes the best managers in the best industrial sectors. I may be mistaken but some of the sentiment in this thread is that JDS is a good buy at current prices because it has such a huge growth rate. But it would be very unusual for JDS to be able to sustain the rate. So, that makes the logic of "good buy at present...." suspect. I agree with your premise that any company no matter what sector can sustain exceedingly high growth multiples year after year. However, I believe JDS and SDLI are at the base of hockey stick growth curves and will have high double digit growth for the next couple years before tapering off. And, yes, the momentum players have made the stock volatile recently. I guess you can't hide forever. :) Pat