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Technology Stocks : Vitesse Semiconductor
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To: The Ox who wrote (4082)4/3/2002 7:23:38 AM
From: OldAIMGuy   of 4710
 
Hi MH, There are times when buying the conv. sub. debentures can be as nice as owning the common stock. I checked a few weeks back to see if there was much of a discount on those VTSS conv. bonds, but there wasn't.

Generally I hope to buy the bonds at enough of a discount to face value to at least equal current 30 year treasury rates. Since it's a 4% bond at face value, that would mean the bond itself would have to drop to 66.7% of face value to give us about a 6% yield.

With this change in Moodys rating, maybe the price of the bonds will fall enough to achieve this goal. With the paper due in just a few years, I find it unlikely. It will be worth checking later today, however.

Thanks for the report.

Best regards, Tom
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