The market is trembling with worry these days that technology stocks may have flown too high. Well, here's one that hasn't: General DataComm Industries, the low-flyer of the high-tech world.

General DataComm, once a market darling, has lost two-thirds of its stock value since mid-January. That's the biggest swoon of any New York Stock Exchange tech stock this year, according to FactSet Data Systems of Greenwich, Conn.

But now a few daring investors are beginning to buy again. It's a risky bet. But they say that despite General DataComm's many problems, the company is worth more than the stock price indicates, and could even be a takeover candidate. At its closing price of 12 last week, it has already bounced off its low of 9 1/4.

``It's something we feel we've bought cheap after a lot of people panicked out of it,'' says Richard Barrington of Rochester, N.Y., money manager Manning & Napier.

``With the stock near its low, I think it's an interesting speculation on their being able to succeed'' by producing the next generation of telephone switches, says Irwin Silverberg of New York's Burnham Securities.

But he stresses that ``speculation'' is the operative word, given that the small Middlebury, Conn., company has been having trouble producing its innovative product and projects a loss for the year ending Sept. 30. ``What they have to do is doable, but it isn't trivial,'' he says.

General DataComm stock soared tenfold between 1992 and January 1995 because the company is one of just a few big makers of a new telephone switch that is expected one day to command a huge market. General DataComm says it has reached agreements to supply phone companies like MCI Communications in the U.S. and equipment makers like Siemens and L.M. Ericsson in Europe.

The hot product is the so-called asynchronous transfer mode switch, or ATM. It acts as a gate-keeper, packaging voice, video and data traffic and sending it down the same phone lines. Phone companies save money by speeding traffic and using the same lines for everything.

A burst of ATM delirium sent General DataComm skyrocketing last year. Just before the peak, the company issued two million new shares in December, raising $58 million. Trouble soon followed, although General DataComm Vice President Robert Smith says the company had no hint of the problems when it sold the stock.

Sales of the company's core products like modems and multiplexers slumped amid heavy competition. And a chip that helps run the new ATM switch didn't work right in the spring, delaying shipments.

General DataComm says that it has improved distribution for the older products, and that the chip problem has been fixed. Mr. Smith says General DataComm will return to profitability by the end of March.

Stephen Koffler of NatWest Securities says it's still too soon to invest in General DataComm. He says demand for ATM switches, tiny today, is building slower than some had expected. Other analysts worry that financially stronger companies will use the time to improve products and outdo General DataComm. Current competitors include Newbridge Networks of Kanata, Ontario, and Stratacom of San Jose, Calif.

``General DataComm is stumbling financially, which is going to hurt it in the sense that it is going to have trouble funding research and development in the ATM area,'' says Curtis Price o ATM area,'' says Curtis Price o ATM area,'' says Curtis Price o ATM area,'' cast a big cloud over its future.'' General DataComm says it is transferring resources from other parts of the company to support ATM research.

Optimists say that General DataComm will remain strong in a growing ATM market. ``It's just a matter of another quarter for them to ride through this transition,'' says John Coons of San Jose market-research firm Dataquest. A money manager who has been buying the stock, but who asks not to be named, notes that ``Siemens and Ericsson signed on in July, well after the problems came out,'' which he says shows they have faith in General DataComm.

Manning & Napier analyst Tony Anagnostakis notes that General DataComm Chairman and Chief Executive Charles Johnson is 68 years old. If the company doesn't rebound soon, Mr. Anagnostakis says, Mr. Johnson could seek a buyer. Mr. Price and Mr. Coons also say the company _ which management controls through supervoting stock _ could be sold.

General DataComm's Mr. Smith says the company isn't seeking a buyer ``at this time.'' He says that it expects its ATM business to grow in the coming year, boosting the stock, and that it would wait for that to happen before seeking a buyer.