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Technology Stocks : Intel Corporation (INTC)
INTC 35.85+0.3%3:56 PM EST
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To: md1derful who wrote (56471)5/31/1998 11:34:00 PM
From: VICTORIA GATE, MD  Read Replies (5) of 186894
 
md1derful

If you stop call me "Yo" so read this make you own call

re<in your opinion, do we have much more to the downside now or do we wait and let this stock perform with the market, >

...fortunately, Intel has to tell the SEC (and thus, us) exactly what it's doing as far as put options.
@ its latest Form 10Q (5/12/98), INTC has 14.8 million puts
outstanding on its own shares. These will expire (meaning Intel
will likely buy the stock back if share price is lower than strike price) at various dates from May-August of this year,
at exercise prices ranging from $69-$95 per share. The average exercise price of all puts currently outstanding is $80/share.
During the 1st quarter of '98, Intel repurchased 22.1 million shares of its stock at a cost of $1.8 billion. since then the company has bought an additional 8.9 million shares for
$712 million (through 5/6/98) and has sold 3 million additional puts.
So...INTC is hedging its bets a little, with its most aggressive puts so far at the $69 level. Apparently the company believes its stock may break through that price on the down side, but is buying back shares pretty aggressively through the repurchase program. The Board of Directors in the first quarter
expanded the repurchase program by authorizing the purchase of an
additional 100 million shares...bringing the total authorized repurchase to 380 million shares. If the price breaks down to the low 60s you can rest assured the company will continue to buy aggressively, at a discount of about $20/share.


vg
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