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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Teflon who wrote (63)	2/18/1999 3:15:00 PM
From: DownSouth	Read Replies (1) \| Respond to of 54805

Thanks for the well-thought, well founded analysis, Teflon. When you said "the choice is obvious", I thought it was, too. But to me the choice was obviously NTAP. <g> (I am long on both and intend to keep them in my core holdings. I would like to buy more EMC.) One comment, on your "growth rate", for NTAP yo have 45%. That is the estimated earnings growth rate for FY00 and FY01, however, their revenue growth has historically been and still is, as of last nights earnings report, 75-80%. Another point, EMC and NTAP play in two different markets, for the most part. EMC is in the mainframe computer room, steeling from IBM. NTAP is in the server room, steeling from SUN, H-P, IBM (AIX), CPQ. They are only just now beginning to bump into one another for the >1TB business as EMC scales down and NTAP scales up. NTAP also offers a web proxy appliance that EMC does not. That is a huge growth market that fits perfectly with their product line. NTAP is competing in that market with INKT, CacheFlow, and CSCO's offering (an "also ran"). I know both EMC and NTAP sales forces. NTAP has every bit as good a sales force as EMC. I believe they are more motivated and more focused, though only by degrees. Your points are valid. I own both, but believe that NTAP will perform better than EMC over the next 2-5 years. Their PE is lower, their growth rate is higher, and their market space, the server room, is expanding more quickly.