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Technology Stocks : Comverse Technology

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To: JakeStraw who wrote (503)	7/1/1998 3:21:00 PM
From: NotNeiderhoffer	Read Replies (1) of 1331

J, Just so nobody stays in the dark (get it?) I thought we might talk about the merits of this name for a minute. Last week the company issued $250 million of convertible subordinated debs. The buyers of this type of security are roughly 30%-50% hedge funds that would hedge their exposure by shorting the common stock against their newly purchased convertible bond. They might not hedge it 100%, but it is likely that well over 1 million shares of stock (probably more)were shorted against the converts last week. Check the short interest numbers that come out in late July in the Journal, etc. The Robby Stephens initiation came as the shorts were doing their thing and the stock held up reasonably well given the circumstances. Thus it appeared the market shruggged off the initiation when in fact it probably helped. The Lehman report today is good news if you put much stock in sell side BS. They have been compiling this list for years and last years list was up 48%. In any case the story is intact and the stock trades OK. Hopefully we see a new high soon. I'm going to the beach. Keep an eye on this for me. NotNick

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