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Technology Stocks : JDS Uniphase (JDSU)
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To: SJS who wrote (4973)1/23/2000 11:17:00 AM
From: t2  Read Replies (1) of 24042
 
Could it be that they are waiting for at LEAST the OCLI deal to close? Maybe they want to wait for the ETEK deal to close, too....

The market cap may be too high by then. The committee's job is to identify candidates for addition to the index. Unless for some reason JDSU does not qualify---there could be unwritten rules that we don't see on the Standard and Poors website. I don't think the deals closing (OCLI and ETEK) is something they want to wait for. Instead the deals may create an urgency to add JDSU before it gets larger from the OCLI deal.
I bet S and P loves it when the index beats the managed funds. By not adding JDSU, they are giving the managed funds just a tiny edge. They will have to sell other stocks in order to pick up JDSU to ensure their portofolio mirrors the S and P, which is market cap weighted. Of course, the managed funds can pick up bargains from the necessary selling by the index funds.
I realize these effects may not be very material but every little bit helps managers to beat the index.

All i can say is that they must have considered JDSU in the past many times and the committee members with a PE based thinking probably outvoted the ones that knew what was happening here.

JDS has gotten so much publicity in the last 2 months (especially January). It is getting close to being a QCOM in the eyes of the media and the investing public. It has gone mainstream.

All i can say is that S and P did a major miscalculation.
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