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Technology Stocks : Network Appliance -- Ignore unavailable to you. Want to Upgrade?

To: Mitch Vine who wrote (592)	2/6/1999 10:50:00 PM
From: kas1	Read Replies (2) \| Respond to of 10934

> Is there anyone out there who can explain > (in fundamental terms) why they think that that NTAP is > still a buy at these prices? Think about where the Web is going. In my mind, it's moving toward the TV model rather than the Usenet model: that is, most users being receivers of large amounts of information from a handful of providers. This is in fact true for all the individual success stories of the Web: Amazon, Yahoo, Remarq, and of course the huge web porn industry. All rely on warehousing tons of data they feed downstream to users who for the most part receive this data. (It's a bit different for transaction warehousing of the sort Amazon does, but still basically the same story) Now think about the sorts of assumptions about the growth of the web made by the market, particularly in valuations of companies like Amazon and Yahoo. These assumptions are something like Web traffic will soon be 50x what it is now. As a corollary, buyers of Web stocks assume that revenues of their companies will rise similarly (or if not more), proportionately to Web traffic. I can't vouch for the profitability of places like Amazon -- I love shopping there, but I don't know if they'll ever make any profits. I can't even vouch for the 50x assumption. But let's cut that sucker in 10 and assume it's only 5x growth. And let's recall that we are definitely moving toward a downstream-upstream dichotomous model rather than a peer-to-peer model of how information moves. Multiply NTAP's profits by at least 5, but maybe 10 considering the previous sentence. Do the same to NTAP's earnings numbers. There are conservative assumptions, you understand. Does that make sense? I think NTAP is now where CSCO was 10 years ago. You must realize that all these stocks that made ordinary people millions of dollars over the years -- INTC, MSFT, CSCO, DELL, etc -- were never penny stocks, in fact always looked overvalued by any measure! I confess that I considered buying CSCO about 6 yrs ago and reached the conclusion that it was much much too expensive. I'd be in a significantly better financial position now had I bought instead of holding off. And so we learn from our mistakes. Any other opinions? Let's get a discussion going.

To: Mitch Vine who wrote (592)	2/7/1999 12:06:00 PM
From: Ricky Rydell	Respond to of 10934

I can only say from past experience that this stock has been a little roller coaster between $30.00 and $60.00 it's entire life, with a definite upward trend and 2 splits under the belt. It is a bit overpriced at it's current value. Hype and the word "Network" in Network Appliance has something to do with it. At least it seemed that way back in 1996 when I first invested. I got in because I work in the business and believed in what they were doing. The way to play this one, at least in my opinion, is when the price is right you buy as much as you can safely afford, and when the price is up you sell a little to get what you paid back. Few stocks will allow you to do this. This one did before options were offered. I'm not certain what will happen now.

To: Mitch Vine who wrote (592)	2/7/1999 12:50:00 PM
From: Ron Kline	Respond to of 10934

I agree with all the posters on the board, and I think we all agree NTAP is a great company to own, but may not be the best time to be buying the stock. If you don't want to get caught underwater buying too high I suggest waiting for a 3 months correction in the market (we have at least 2 a year) and watch the action in the stock and see how it withstands the correction. There is always a correct time to buy a good stock, and it takes patience to wait for that opportunity. I did that in the last cycle with NTAP and bought all the way up as it broke out to new highs after the market rebounded. The chances for me to lose money are very remote at this point even with a correction because of my timing. After an extended move it's a tough call to buy any stock because you can easily get caught underwater. If you can handle that and not panic then NTAP still is a good investment even if you were to buy it at these levels, because I believe that it will breakout again to new highs after the next correction. Ron