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Technology Stocks : All About Sun Microsystems
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To: cheryl williamson who wrote (3724)8/28/1997 1:19:00 AM
From: jeff armstrong   of 64865
 
Cheryl,

Thank you.

Actually, my natural optimism leads me to believe that SUNW can continue to have an outrageous string of quarters where they always beat analysts expectations by 5 to 10% (rather than 2 or 3 blowout qtrs which would raise unreasonable analysts expectations).

SUNW is a well managed company that has associated itself with the old "Motherhood, Apple Pie and the American Way" by supporting open systems and Java. I agree with your support at 45 analysis (50-day trailing average is at 44) and your projection to 60 (who knows, maybe they will split in November again).

Will Java licensing fees appear in their Consolidated Statement? I would expect them to tout it when revenues are significant.

Personally, I struggle with keeping the stock as a longterm investment or trading it for short term gains. The trailing 5 years show a 700% gain. On the other hand $50K would pick up 2000 shares (current price of 49-3/4) if you margin to a 50% equity position, then you sell Jan 98 strike price 55 covered calls at 4-1/4 per share AND IF it reaches 55 by Jan options expiration you make $19K profit on $50K investment (38% increase in 4-1/2 months). Then you could do it again. OR you could buy now, let it rise to 60 and sell covered calls at 65. I don't think you can lose, but the bulls and bears get rich, while the pigs go broke (usually).

I like this company. I think it's a cash cow that will hasten opportunities to enjoy life.

Happy Trails!

Jeff
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