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Technology Stocks : EMC How high can it go? -- Ignore unavailable to you. Want to Upgrade?

To: VFD who wrote (5489)	4/15/1999 3:24:00 PM
From: TraderEd	Read Replies (4) \| Respond to of 17183

Received this email from EMC about an half hour ago. This morning analyst Paul Fox of Montgomery Securities downgraded the storage sector stocks based on "macro spending slowdown fears" related to Y2K. Paul based his rating changes on conversations with 45 IT users in the Fortune 100. EMC respects Paul's -- and all other analysts' -- work on this important subject and incorporates such findings into our own analysis. EMC has been conducting surveys of its own on 1999 spending and potential Y2K impact. We just completed a survey of over 250 customers in Q1 that queried users on their spending plans for the year . The results leave EMC confident in the growth guidance we have provided (better than 30% top and bottom) and indicate continued strength in storage demand throughout 1999. In addition, EMC has done work toward defining the catch-all phrase, "freeze". Among some of the definitions, freeze means no new functionality (such as applications as opposed to capacity); no new, untested technology (don't plug any new IT invention into my shop in 2H99), to others, no new IT product in the mainframe area (Y2K is largely a Mainframe issue); and to other customers it means more stringent change management. There are also those customers who will not buying anything in Q4. Pursuing this statement a little further, we found that many of these customers freeze as a usual course of business around the August/September/October time-frame so as to not upset the IT infrastructure in the Christmas season. Analysts such as Josh Krischer of Gartner Group and Lou Marcoccio, Gartner's Research Director on Y2K , Carl Greiner of Meta Group (203-973-6751), and John McArthur (508-935-4615) have also concluded that storage spending in 1999 looks solid. <<gartner on Y2K 3_99.doc>> Bottom line: While no one knows for sure what will happen due to Y2K, we continue do what we can to collect and analyze vast amounts of customer and outside analyst input. At this point, EMC sees continued strength for its business in 1999 and customers are reporting strong spending intentions for EMC products. An EMC news release issued today follows. ----------------------------------------- FOR IMMEDIATE RELEASE EMC REITERATES POSITIVE OUTLOOK FOR 1999 Extensive Customer Surveys Indicate No Anticipated Decline in Storage Spending HOPKINTON, Mass. - April 15, 1999 - EMC Corporation today announced that recent surveys of hundreds of customers indicate that enterprise storage spending will remain strong throughout 1999. The company reiterated its expectation that revenue and net income growth will exceed 30% in 1999, as organizations continue to rely on EMC's leadership enterprise storage systems and software to provide the infrastructure for their growing volumes of information. EMC continually surveys customers regarding future spending intentions and their overall satisfaction with EMC products and services. The results of the latest survey, which included more than 250 customers and was conducted during the first quarter of 1999, indicate robust demand throughout 1999. EMC Corporation, based in Hopkinton, Massachusetts, is the world's technology and market leader in the rapidly growing market for intelligent enterprise storage systems, software and services. The company's products store, retrieve, manage, protect and share information from all major computing environments, including UNIX, Windows NT and mainframe platforms. The company has offices worldwide, trades on the New York Stock Exchange under the symbol EMC, and is a component of the S&P 500 Index. For further information about EMC and its storage solutions, EMC's corporate web site can be accessed at emc.com. This release contains "forward-looking statements" as defined under the Federal Securities Laws. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) component quality and availability; (ii) delays in the development of new technology and the transition to new products; (iii) competitive factors, including but not limited to pricing pressures, in the computer storage market; (iv) the relative and varying rates of product price and component cost declines; (v) economic trends in various geographic markets and fluctuating currency exchange rates; (vi) deterioration or termination of the agreements with certain of the Company's OEMs or resellers; (vii) the uneven pattern of quarterly sales; (viii) risks associated with acquisitions; (ix) Year 2000 issues; and (x) other one-time events and other important factors disclosed previously and from time to time in EMC's filings with the U.S. Securities and Exchange Commission.