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Technology Stocks : How high will Microsoft fly?
MSFT 413.32-0.1%Feb 10 3:59 PM EST

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To: Jon Stept who wrote (3725)10/22/1997 4:07:00 PM
From: vinod Khurana  Read Replies (3) of 74651
 
The problem here Jon is that the bad news against MSFT comes at a time when its stock is trading above 45x earnings and close to the 52-week high as opposed to the 52 week low.
Had it been at or close to the low when the allegations were made, one could argue that the news would not affect the stock price as much.

Take a look at INTC. The lawsuit against it by DEC came at a time when the stock was close to the 52 week high. The plunge recently has factored any expenses the company may incurr.
MSFT is in no different position.

Bullish investors can ignore the potential impact of the DOJ investigation hoping nothing comes of it but the reality of the markets that they just don't like uncertainty in my opinion will be a weight on MSFT stock for some time to come. I don't think the DOJ will give up anytime soon and especially with Janet Reno leading the pack.
She is the Presidents choice after all.

V.K
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