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3Com Shares Rise on Profit Optimism

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March 24, 1998|Bloomberg News

3Com Corp. shares rose 5.8% amid optimism that the company is improving its inventory control and will meet Wall Street estimates when it reports fiscal third-quarter earnings today. The Santa Clara-based maker of computer-networking equipment has been dogged by excess inventory of modems and similar products since it acquired US Robotics Corp. last June. Slower modem sales were caused in part by the lack of a technical standard for the fastest telephone-based--or 56K--modems. In December, 3Com reported a 91% drop in net income, surprising most analysts, as it struggled to reduce excess inventory of products sold to former US Robotics customers. At that time, the company said it was implementing procedures to get more timely, detailed sales information as products are shipped through distributors to customers. 3Com is expected to earn 13 cents a diluted share in the third quarter. 3Com shares rose $1.94 to close at $35.13 on Nasdaq trading.

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