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Technology Stocks : Ascend Communications (ASND)
ASND 212.00-0.6%Dec 16 3:59 PM EST
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To: username who wrote (34247)2/10/1998 4:31:00 PM
From: Alok Sinha  Read Replies (1) of 61433
 
My average price is 30.5 on the stock (although I made a lot of money on call options on the run from 23 to 28 at the beginning of the year), and I am not geting ready to bail. In any case buying price should be irrelevant as far as selling is concerned.

Remember, the stock was doubling every year till it ran into TNT related problems. The warned so late that management lost all credibility with the Street. I get the feeling that mgt is slowly learning to play the Wall Street games (like CSCO - keep expectations down and then surprise. They may also be managing their quarterly revenues to show decent sequential increases. When they were a small co. which was growing in an explosive manner, there was no need to do all this. At $1 B in sales, you can't double rev every year, esp. with downward pressure on prices under stiff competition.

Ii expect the stock to trade in the 40s towards the middle of the year (on fundamentals) and valuation of competitors like CSCO. If there is takeover talk it may get there fsater, but probably not be sustained. The time to bail would be if it makes a move to the high 40s or 50s ahead of the fundamentals. The chart for ASND over the last few months has been surprising steady upward move which is encouraging.

So I am holding on. I will be establishing a protective put position in the next few days on my largest exposures, since I am convinced that the market is getting ahead of iteself (even though ASND's rise has been gradual).

Regards

Alok
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