How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 508.82

+0.6%

3:59 PM EST

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To: Insitu who wrote (43225)	4/24/2000 3:25:00 PM
From: johnd	Read Replies (5) of 74651

Here are my views on what will happen as we look into the future. I will condense it all into one post as people seem to like not read several. Trial: ===== I think the DOJ and states will come out with the break-up + restriction remedy proposal. Microsoft will seek more time to Jackson to review the remedy. Jackson may or may nit grant. But in good faith, might grant 2-4 weeks. So Microsoft may have to respond by May end. Then DOJ gets a 2nd chance and remedy hearing may start end of June to early July. May go on till October. Then comes the appeals process which will last till end of 2001. Regarding restrictions till appeals, I think MSFT will appeal that ruling right way and appeals hearing will decide stay or overrule. Put warrants: ============== Out of 161mil outstanding some expire by June this year and those some will for sure get put and I think MSFT will take the put assignments. May be some 30 - 40 million shares at a cost of 2 - 3 Billion. The others will have enough time premium that they won't be put. These would be the cheapest buyback in a long time. Stock buyback ============= I think this will get approved by some time end of July or early August, prior to the next annual meeting. Once approved, MSFT will start buyback. Business: ======== I think MSFT will start having more and more deferred revenue and I believe calendar 2001 is going to be very very robust with sales from the fresh product pipeline. About stock: ============ Near term - next 2 months, MSFT may go lower. No one can tell where the bottom is. May be 60, may be 55, may be 50, 45 or even the 20 (though I find hard to believe below 50) And at 20 I may take a mortgage to buy more. Some analysts say 55 is about the bottom. Whow knows? After mid-August, I think the stock will start moving up upon realization that business is pretty storng etc.. I think the stock will go around 180 - 200 by end of next year. I use to think it wil hit 300 by end of next year. But the resolution of the case may not happen by that time. Still 180 - 200 require a PE of 55 and an earnings of 3.00 for CY2001 and I think MSFT will deliver that with revenues in the range of 35 Billion for CY2001 and earnings in the range of 16 Billion. I am so glad I didn't margin else now I would be sitting on margin calls. It has been gutrenching to sit and watch it slide like this. But I am not doing anything to my long positions. Holding on for 2-3 years. Did buy some 01 leaps.

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