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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: Techplayer who wrote (28539)	3/2/1999 8:15:00 PM
From: PerryA	Respond to of 45548

3Com Experts: I will be getting DSL in a couple weeks and need to buy two NICs -- one for laptop and one for desktop -- which will most likely be 3Com cards. As DSL becomes more widespread, could this need for NICs provide a big boost to 3Com or is this part of 3Coms business too small for it to have a significant impact? OT: Any recommendations on what cards to get would be appreciated. Thanks, PerryA

To: Techplayer who wrote (28539)	3/2/1999 8:53:00 PM
From: Tim McGee	Read Replies (1) \| Respond to of 45548

Looking forward... I for one am glad that 3Com mgmt came out and said something today. It is much better to know this disappointing story now than be tossed around by the unknown fear that has be present the last month or so. It is reasonable that they got the word out as soon as they were sure of the exact numbers. However, it is not credible that they have such a poor handle on their revenue situation that they could not warn last week - especially when they indicate results might be near estimates if a bit low. Obviously they blew it big time here. The channel - which they claim as a strength - has turned out to be the area where information was bad. The patience is out with this management. But the long term story can still be positive. We are still sitting on a pretty good value. This FY will be somewhere near 5.5B in revenue and the market cap currently near 9B. We're getting pretty close to intrinsic value of the company. Multiples remain low. On current earnings for this year 1Q .24 2Q .36 3Q .23 4Q .37E (my own estimated cut from current First Call .41c) FY 1.20 A PE of 25 yields a stock price of $30 for FY99. 35 PE = $42. So we should be able to trade in that range as soon as evidence appears that this qtr has not inflicted longer term damage. Taking a conservative view on FY00 est of 1.80 (current First Call is 1.90 - 2.00), a forward PE of 25 yields a $45 stock and a PE of 35 yields a $63 stock. IF things are really ok going forward at 3Com, we are looking at a situation where will be able to get a $30, $45 or $60 stock for the low 20s. COMS will most likely trade lower as most investors will want to avoid the risk that even the above numbers won't be reached. As time goes by, we should be more accurately be able to know which of the price ranges above is right for COMS - it will almost certainly be higher than what we'll see in the next few weeks. Tim

To: Techplayer who wrote (28539)	3/2/1999 9:08:00 PM
From: Stephen	Read Replies (1) \| Respond to of 45548

Brian ... you obviously haven't been in Ascend long enough !. When the stock began its drop a couple of years ago, Mory told everyone at a conference that business was stronger than ever. The stock gained 5 points, then further weakness in the price continued as it underwent distribution. At the time I wasn't experienced enough to know what was happening .... but I held it from 55 down to 36 ...and never bought back in even in the low twenties because I no longer trusted the management ... and still don't. I think they got the Lucent deal just in time and piled everything in to meet the last two quarters. This sector is littered with many ex-highflyers. I think 3COM can go lower even if it bounces, and if Ascend hadn't bought Cascade, it would have had a hard time ever getting back to the 30's, and without the Lucent takeover rumours, struggled to get in the 40's. JMHO..... but there's nothing new here .... as pretty well most of you poor 3COM longs know. A small silver lining is that the stock has had a haircut already ... so the lingering effects I've seen with other stocks (like DELL, CPQ) which have continued after the initial drop, should be muted. BKDIK. Good luck all Stephen