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Our panelists give you the scoop on all the inside business information before you hear it anywhere else in The Informer segment:
David Asman: Chana, Iraqis need phones, and they’re starting from scratch. Who’s going to sell those phones and how do we make money off of it?
Chana Schoenberger, staff writer: Well, there are four big companies poised to make money out of this. It’s about a $200 million plan, and they are Motorola (MOT), Nokia (NOK), Ericsson (ERICY) and Siemens AG (SI). They’re all cell phone equipment makers and makers of the actual phones. What happened is that the Unites States gave concession to Iraq for three Middle Eastern countries. These are all companies that have existing vendor relationships with those Middle Eastern companies.
David Asman: Bruce, it’s a great idea.
Bruce Upbin, senior editor: Yeah, but how come only one of the companies is American? I thought that when we went into the war, it would be “to the victor go the spoils.”
Chana Schoenberger: You know, it’s funny because, actually, the standard that they went with here not CDMA, which is QUALCOMM (QCOM) standard, but actually GSM, which is the other one. So the Americans are ‘behind the eight ball’ on this one, entirely.
David Asman: So, there’s no infrastructure, they’re starting from scratch, they may have a phone service more modern than ours. We’ve got to move on. Bruce, Sun Microsystems (SUNW) used to be one of my favorite stocks. I sold it a while back.
Bruce Upbin: Yeah, so did a lot of people. This stock is around $3.70, or something. It’s the stock that everyone loves to hate, but I’m here to tell you that it’s going to go up. They’re doing all the right things, they’ve stabilized the management, they’ve cut costs enough. A lot of people on Wall Street who used to love this stock at $95, are now yelling at the company, that they’re doing all the wrong things.
David Asman: Wow, Chana, the stock could double? That’s big money.
Chana Schoenberger: I don’t think so. The problem with Sun is that it doesn’t have as big a services division, and services are really going to be the future of technology. IBM (IBM) has a huge services division, on the other hand.
Bruce Upbin: Yeah, but they’re spending so much money on the core technology, which is what we need to do right now, to go forward.
David Asman: OK, SUNW, the contrarian move. Now, Mike, you have the cover story.
Mike Ozanian, senior editor: The 200 best up-and-comers. There’s a company that I like a lot on there called ResMed (RMD).
David Asman: So, these are small companies, with huge potential?
Mike Ozanian: Right. Sales right now, under $600 million, but fast-growing earnings, so they’re going to get big, quickly. ResMed is a company that makes products for people who have trouble breathing when they sleep, like masks to help them breathe. The stock’s around $45. It’s going to $60.
David Asman: Anybody like this, or other small companies?
Bruce Upbin: I like the stock that I wrote about for the cover, Mercury Interactive (MERQ).
David Asman: That’s the guy, the guy who is on the cover of the magazine, is the guy you wrote about?
Bruce Upbin: They do software, and have very smart management.