View Full Version : Sun Micro Systems "SUNW"?

10-04-2004, 02:02 PM
My first stock post, just so you know. I was curious if anyone knew much about this stock. I have been following for about six months now and it gets a lot of volume. The stock is currently rated an "F" by Reuters, yet it continues to go up in value. As a matter of fact SUNW has risen from its low of about $3.50 to $4.30 with an F rating. My question is this why would a stock with an F rating continue to climb in value? Also, do you beleive this stock is a good buy at $4.29.I am new in the market watch so please forgive my ignorance. Thanks

10-05-2004, 02:15 PM
I would say that analyst opionions on large caps are large devoid of useful or actionable material, especially if you are looking to own rather than trade.
Instead of looking at recommendations, take a look at the company's balance sheet and earnings. I don't like Sun's prospects myself, but that's just because I like companies with clean balance sheets, free cash flow, and a history of earnings growth (=boring but safe)

10-05-2004, 04:04 PM
According to Yahoo, SUNW does have a clean balance sheet and free cash flow, just no earnings growth.

10-05-2004, 04:15 PM
Linux put a big hurt on SUNW after the tech bubble burst. SUNW is getting cut throat competition in its business from DELL, IBM, and HPQ among others. Financially SUNW is in good shape but they haven't made profits on the Income Statement in ages. FWIW I think SUNWs SPARC strategy is a loser. I haven't followed SUNW for a year but SUNWs best niche was the vertically integrated, multiprocessor server market where they compete well. That market isn't that big though and may not grow all that fast. I'm not too keen on Scott McNealy either as a CEO.

With that said, if the stock was cheap enough I'd buy. I'd buy it at $2.50 for sure. At the prices today it's a more risky buy and looks to me to be overpriced but it has gone up to the mid 5's about 1 year ago I think.

10-05-2004, 09:31 PM
Sunw is a risky stock that I'm not sure has a high reward. There have to be better plays out there.

If you like tech stocks, how about ebay? High growth, and they won't be going out of business any time soon.