I just got lucky on ASND. Whenever it gets to $40, I get excited! I had no idea Salomon was going to cut ASND.
What's unbelievable is that ASND is going down on old news. It was reported in Aug that this quarter would be off and that news dropped price from 52 to 44 in two days. Now, all of a sudden, analysts have refocused their warnings, identifying slower sales in Europe.
I don't know if you noticed, but last week Nextel was chugging along with a series of good reports and little happened--it was in the 24-25 range. Then, one anaylsts refocused all this news into one report which subsequently drove price to 27--I sold at 26 13/16 not knowing about the news because it was issued after hours. Anyway, that new lasted about 2 days and today NXTL is trying to pick it self up off the floor at 26.
This is a game analysts play. I'm sure someone in their firm knows these reports are going to be issued. And sometimes, they issue bad news that creates buying oportunities or good news to creates selling oportunities.
ASND has a lot of people following it, and therefore there is all kinds of information--some of it is contradictory; e.g., Furman Selz upgraded it to a buy on 9/3/97 and on 9/11/97 Salomon downgraded to a hold. What's the truth? Who knows? It's the game people play.
I think one important piece of news the bears don't give out on ASND is WorldCom's recent purchase (9/8/97) of CompuServe. With this acquisition, WorldCom has become one of the largest ISP in the world, and they do it through UUNET which was acquired by MFS Communications which was then acquired by WorldCom late last year. UUNET is twice times removed from WorldCom and many people who just follow the flow will not realized this until some analysts tells them.
The neat thing about the CompuServe deal is that WorldCom kept CompuServe's network unit and swapped its subscribers for AOL's high-speed networking division, ANS Communications. UUNET, now provides the underlying structure for Microsoft Network and AOL--the two largest commercial on-line services albeit fiercest competitors.
Now consider ASND provides switches and modems to UUNET. This relationship is probably going to provide the earnings suprise, not this quarter but later, the same analysts who downgraded today will use to upgrade tomorrow, of course, after they get their people back in at basement bargains. Well, I started buying ASND at 41 and am followed it down in 200 shr increments. Sold my RII at 27+ to do it. Thinking, of course, ASND will deliver a 10-20 point pop before RII. So, if you are up in something, besides RMTR, I suggest you think about some of this. I'm out of here!
I think the best networking company out there is COMS, due to report 9/23. I've seen no bad news on them. However, ASND is a special play. |
