How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 477.19

-0.4%

3:59 PM EST

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To: Sonki who wrote (1292)	5/9/1997 6:55:00 PM
From: chenys	of 74651

MSFT is a bit ahead of itself now, partly due to the safe heaven, like IBM of the eariler days, kind of psychology. Many analysts lost their jobs by sticking their necks out for IBM all the way down to the bottom. They were right eventually, only that it is seven or eight years later. There are risks at this juncture. It might retrace first before a major move again. Though only about 60-70% floating out there (30-40% held inside), 700-800M shares certainly would take a long time to distribute. When you see a lot of activity but little price change, that is distribution. You should take note of the past week or two. That is exactly what was going on. It depends on who is the stronger hand of this distribution to see what is next. If the weak hand is selling (buyiny) now, then the next move is up(down). We will see. A possible scinario is that it would go back to 80 or 90's to make the PE more sustainable, and then asend from there over the year to make to new highs, say 160-180. Therefore, I'd have some hedging at this point, maybe even with some shorter term LEAPS just to be sure there is time to mend if the decision goes againgst you.

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