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

To: mr.mark who wrote (28674)	3/3/1999 3:35:00 PM
From: Moonray	Read Replies (1) \| Respond to of 45548

S&P revises 3Com <COMS.O> outlook to stable (Press release provided by Standard & Poor's) NEW YORK, March 3 - Standard & Poor's today revised its outlook on 3Com Corp. to stable from positive. In addition, Standard & Poor's affirmed its triple-'B' corporate credit and bank loan ratings on the company. The rating affirmations are based on the company's strong positions in the rapidly growing networking industry and its solid profitability, somewhat offset by an ambitious acquisition strategy and rapid technological evolution. The revised outlook reflects lower growth and profitability than had been anticipated. Santa Clara, Calif.-based 3Com provides local area network adapter cards, products for the "edge" of the networking market, modems, remote-access concentrators and hand-held digital assistants. Competition has become increasingly aggressive in all segments, while underlying growth appears to have slowed. 3Com's broad range of developmental businesses could provide new growth opportunities over time, but visibility is limited. 3Com is likely to continue its pattern of niche acquisitions as the technologies supporting its several markets evolve in the next few years. Profitability has been affected by the company's changed product mix, as well as efforts to trim excessive channel inventory levels. Operating margins are likely to remain in the mid-teens percentage area, compared to the mid-20% area through fiscal 1997. 3Com retains substantial liquidity, $1.4 billion at Nov. 30, 1998, with minimal debt. OUTLOOK: STABLE Anticipated marketplace pressures are likely to constrain profitability gains over the next several quarters. The company's ample financial flexibility and strong technology base should provide a good measure of downside protection, Standard & Poor's said. REUTERS Rtr 15:00 03-03-99 o~~~ O