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

To: Robert Douglas who wrote (8738)	4/30/1999 10:39:00 AM
From: Toko	Read Replies (2) \| Respond to of 9124

Robert, < If DLT is really generating more money than they need to grow, then what is the purpose of creating a stock that is trading at high levels? Do they want to do an equity offering to raise money when they don't need it? And what will they do with this kitty? Buy new businesses to diversify of course!> Your case against tracking stock is exactly one of my reasons to be in favor of the tracking stock. Do you think there is no value in diversification to balance the seasonality of the HDD business? If Cisco or Microsoft had stood on your argument where would they be today? The netcentric data storage world is going to look a lot different in the next few years than it does today. Even if Quantum maintains leadership position in HDD market share, that portion of the business could become small (revenue and profit) compared to their systems business. We have yet to see much of the synergy that will come out in new products that leverage the skills and products in the 2 operating divisions. I appreciated your post from A. Neff, but surprised to see no mention of the cash generation that gets bigger every quarter from the royalties in the DLT tape business. As the installed base of DLT continues to grow steadily, that tapes royalty gravy (straight to the bottom line) is like a sling shot that keeps building momentum. Now Tandberg is also helping by pumping more DLT drives into their worldwide customer base. My opinion is $20 for QDSS is laughably low; I hope the $70 estimates come true, but probably more than a year away before the bottom line really starts growing for a few quarters in a row more visibly. By the way, I think the Quantum shares buy back ended around the time of the closure on the ATL acquisition. I predict this Oppie upgrade to "strong buy" will not be the only one. -Toko

To: Robert Douglas who wrote (8738)	4/30/1999 11:59:00 AM
From: Frodo Baxter	Read Replies (1) \| Respond to of 9124

>Am I the only one that thinks that the tracking stock is a bad idea? After all, the motivation behind the move is a conviction that the stock market is too stupid to add or that this will allow the DLT business to attain some wild valuation based on speculative frenzy. Yep, you're right. Markets are rational and efficient, and peons like us can't yield higher returns by investing wisely. p.s. Can I buy some of your QHDD stock for -10? >In other words, management has spent too much time listening to investors like us who watch the stock hourly. Better they focused on their business than watching their stock price. Investors have only suggested this idea for the past two years! I wish management was more responsive to my suggestions. If they had, Maxtor would long ago have become an operating subsidiary. >If DLT is really generating more money than they need to grow, then what is the purpose of creating a stock that is trading at high levels? To use as an offensive weapon, of course. (cf. Amazon, AOL, Yahoo and the acquisition binges they've undertaken) >I'm not looking for something that is a quick double and then I'm on to something else. What I would like is a company that is a quick double that I can hold for 5 or 10 more years and get 2 or 3 more doubles! <g> You're investing in the wrong stocks. That's 5 or 10 more months. <GGG> Seriously, I'm a huge fan of Dandy Andy. He made a prescient bull call on Intel a few years back that was dead-on correct and actually made me money. Very few analyst gibber have actually made me money. Dandy Andy's not flashy like the Dark Prince Kurlak, and I don't think anybody's ever called him an axe, but he's consistent and usually correct.