Is the Sun Shining for Sun Microsystems?

Dennis Biray
 


Visitors: 159

If you invested in the technology sector during the late 1990s, you probably became very encouraged from the amazing capital gains you earned during this time period. Sun Microsystems (SUNW) is no exclusion this system, reaching record highs in of 80.00 in 2001. However, like most of the rest of the technology sector, Sun experienced losses hurting every investor still stuck with the overbought equity. However, five years later as the dust has settled, does Sun pose itself to be a reasonable investment?

Economically speaking, technology stocks have increased during periods of inflation and have fallen during periods of recession. As inflation have been rising the past few years as represented with the continued increase in interest rates, you would have expected a gallant corporation in Sun to increase back to its glory days right? While such a sentiment is usually an excellent one, Sun has failed to provide investors with any comfort. Through the past three years, Sun has experienced no growth whatsoever despite indications of head and shoulders technical situations. Supporting a resistance level of 5.25 and a supporting level of 3.50, a timely speculator is able to make good short term investments, but long term investors are not able to help their fixed-income desires. What makes matters worse for investors looking at Sun is the potentially hard landing recession in store for the US economy. During such a period with the decrease in employment and domestic income, consumers have less money to purchase luxury goods such as Sun’s software products, and as a result revenue for the corporation will go down.

When such happens to a company, a decrease in quantity demanded for elastic goods will hurt the profits which have already been hampered for Sun. With an unusual decrease in margins in terms of revenue and profit over the last three years sustaining poor operating margins, there is little optimism in terms of future growth for this company. If you do own this company, I would suggest selling immediately, as I really doubt Sun will reach 5.00 again for the next few years. While the company is respectable and well known as a large capitalization equity, like Microsoft and other companies, Sun looks like it has lost its original steam and will be more of a nuisance to investors rather than capital gainer.

Dennis Biray presents advice on all kinds of topics ranging from finance and investing to fitness to sports. For more information email him at dbiray@gmail.com , or to view other articles written by him visit http://www.biraynetworks.co.nr

(432)

Article Source:


 
Rate this Article: 
 
Fun, Fun, Fun in the Sun, Sun, Sun - Choosing Your Swimwear This Year
Rated 4 / 5
based on 5 votes
ArticleSlash

Related Articles:

Dell Corporation's Influence on Sun Microsystems

by: Gamil Sawiris (August 12, 2008) 
(Computers and Technology)

The Sun is Shining on Cyprus Tourism Industry

by: Adam R. Singleton (July 01, 2008) 
(Travel and Leisure/Destination Tips)

When The Sun Is Out And The Sky Is Blue, Try Not To Let Sun Damaged Eyes Spoil ..

by: Ruby Hashim (May 20, 2008) 
(Health and Fitness/Eyes Vision)

Sun Tanning Safety - Myths About Sun Tans - Counteract UV Rays

by: Nathan E Peterson (September 03, 2008) 
(Cancer/Skin Cancer)

Outdoor Sun Shade Sails -- Protection from the scorching sun

by: Derek Warner (May 25, 2010) 
(Business/Small Business)

Coping With Sun Sensitivity Tips on Sun Protection

by: Marta Phillips (June 27, 2008) 
(Health and Fitness/Skin Care)

Baby Sun Protection and Child Sun Protection Teaching Your Child About Sun ..

by: Marta Phillips (June 30, 2008) 
(Home and Family/Babies Toddler)

Absorb Some Sun on Rattan Sun Loungers

by: Kris Davies (April 27, 2012) 
(Home and Family/Interior Decorating)

Sun Exposure and Sun Screens When Tanning

by: Steve Lott (June 21, 2008) 
(Health and Fitness/Skin Care)

Fun, Fun, Fun in the Sun, Sun, Sun - Choosing Your Swimwear This Year

by: Alvin Yakatori (July 11, 2008) 
(Shopping and Product Reviews/Fashion Style)