> 3Com, the second-largest US networking vendor, could face subsequent
> quarters of weak results because of increased pricing competition from
> Intel's Ethernet adapter cards.
Yet another market falls prey to Intel. That's the extension of Moore's
Law (a/k/a Ginsberg's Theorem): 1. You can't win. 2. You can't break
even. 3. You can't even quit the game...
> "Clearly people were spooked by 3Com's financial problems, and I think
> that translated into problems for the other stocks," said Amar Senan,
> an analyst at Volpe Welty & Co.
Poor Bob. No wonder he's so interested in cyberbucks. In the world of
kudos, the men with bits are kings. Intel or no intel.
-- Adam
-------------------------------8< snip snip snip ------------------------
BALL AND CHAIN
3Com's tumble starts a wave of investor uneasiness that its networking
peers can't escape.
By Andrew P. Madden
3Com (Nasdaq: COMS) shares plummeted more than 28 percent on February 10
after the company warned third-quarter earnings would be much lower than
expected.
While analysts had been expecting earnings of 60 cents per share, the
company warned that earnings would be in the mid-40 to low-50 cents per
share range due to disappointing revenue.
3Com, the second-largest US networking vendor, could face subsequent
quarters of weak results because of increased pricing competition from
Intel's Ethernet adapter cards.
3Com, which said it expects to release final results for the third
fiscal quarter on March 20, was not the only networking company to take
a shot on the chin over the last week.
"Clearly people were spooked by 3Com's financial problems, and I think
that translated into problems for the other stocks," said Amar Senan, an
analyst at Volpe Welty & Co.
Despite the 11th consecutive quarter of double-digit revenue growth for
networking bellwether Cisco Systems (Nasdaq: CSCO), its shares dropped
over 8 percent in recent trading.
Cisco's sales and net income rose, but acquisitions in the quarter
pulled the company's numbers below analyst expectations.
Beleaguered Bay Networks (NYSE: BAY) recently began layoffs of
approximately 120 employees, or 2 percent of its work force, and
announced that certain current employees would be realigned within the
organization.
Bay Networks joins networking players Cabletron Systems (NYSE: CS),
Cascade Communications (Nasdaq: CSCC), and Ascend Communications
(Nasdaq: ASND) as a bruised victim of the recent fire sale of networking
stocks.
"I think this is an overreaction, because the fundamentals for many of
the other networking stocks are fine," added Mr. Senan. "To see Cisco
and others move down in tandem was a little unfortunate."
----
adam@cs.caltech.edu
Believe it or not George isn't at home, please leave a message after the
beep.
-- George's answering machine on Seinfeld (to the tune of "The
Greatest American Hero")