C-Cube Message Board - Msg: 1152072

STOCKTALK

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Technology Stocks : C-Cube

CUBE 36.29

+0.7%

Nov 18 3:59 PM EST

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To: Humblefrank who wrote (13036)	4/8/1997 10:22:00 PM
From: Humblefrank	of 50808

I posted something on the MF board which goes along with what I was saying here. I wonder if it is posible to read the MF board without being on AOL. Does anyone do that? Someone on the MF board stated that Burke and the new CFO are planning a trip on the 14th to drum up new investors. This was my response. >If Burke and the new CFO are planning to take a trip meeting investors then likely the earnings will be somewhere down the middle. If they were hot they wouldn't need a trip. If they were cold Burke would have sold his stock. He had a good enough excuse anyway. Also, notice the high number of April put options compared to calls. The later months have more calls. Those puts mean people think the stock will fall, but they also mean the option market makers are not going to let the stock fall too far. Most of the puts are at 25 and 22.5. The number of 22.5's went down today and the 25's went up. That was a smart move for whoever did it cause the 22.5's will almost definitely waste away. Unless the earnings come in at about .30 the option market makers will keep the stock above 24 until options expire. Right now option sellers would lose about 10 million dollars for every point the stock falls below 24. 10 million dollars could buy you more than a point up so that's not likely to happen. In short longs don't need a hedge because they have one whether they pay for it or not. Many of those puts are likely hedges for longs anyway.> You never know who's buying options so I could be completely wrong, but I think those buying 22.5's or 25 are going to lose money. I bought a small number of 30's to go with my long position. Since they're in the m money they shouldn't waste away as much. Since not many of them were sold the option market makers are not going to try to raise the number to shut me out. I wrote yesterday that the stock could go to 50 by Q2 and 70 by Q3. Depending on earnings that could be pushed back a Q. If they're less than .43 the shorts might want to stick around for next quarters numbers. If they're more than .43 they'll likely plan an exit somewhere between quarters IMHO. I've been wrong about the shorts before though so maybe they'll just stick around until the fire burns their asses.

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