Wow, the original gang (OG) is back. Talk about liquidity sitting on the sidelines. The quality of analysis by everyone (Gary (OG), Gary (Korn), Gary (gbh), Bindasugar, Sector Investor, a few Yahoo threadsters, etc.) has been quite excellent over the last couple days. A couple comments and idle speculations.
1. Lots of talk about insider sales this month. Kudos to Jan for alerting everyone to the window period. My thoughts. If there is a LU buyout coming after 10/1/98, to my knowledge (please correct me if I'm wrong), insiders would be restricted from selling shares for 6 months after the acquisition (?). Thus, it seems perfectly rational to take this last window period to sell. In addition, as we all know, ASND's share price had recovered nicely to the low 50s and insiders would be very rational to sell. Contrary to the BS on the Yahoo thread, I've got no problem with sales by insiders in Silicon Valley tech firms in which stock options are considered part of your compensation. Investors have to be more sophisticated in considering whether insider sales are telling you anything meaningful or not.
In addition, I wonder if this temporary overhang of stock from insiders exacerbated the selling panic on Friday. Combined with the lack of buyers on a down market day, it couldn't have helped.
2. I would love to read some analyst reports over the next week especially from Johnson (BARS) and Noel (H&Q). Sector Investor?
3. On a lighter note, we've temporarily broken the inviolate connection between the number of SI posts and ASND's share price. I'm sure technical analysis is required as to whether or not we will fill the gap.
4. ASND fundamentals remain intact -- should I repeat this point. There has been no hint of earnings problems or technology glitches compared to last year around this time. Maybe we should reexamine the fundamentals.<gg>
5. Based on all of my research, I continue to believe that LU "lusts" after ASND and they have a very strong strategic fit. If LU want to be the premium worldwide equipment supplier, they'll have to take out ASND and their premium customer base and technology. If they delay and try to go the startup route, they will face increasing competition from CSCO and NT/BAY as the LU voice/circuit equipment becomes obsolete in a much faster than anticipated time frame.
6. I would like to read more analysis of a possible LU acquisition of COMS and FORE. As COMS becomes cheaper and cheaper, I wonder if LU might decide that their product overlap and COMS commodity market segments are outweighed by the chance to grab the historic No.2 competitor to CSCO. I'm sure COMS engineers have lots of interesting products in their R&D labs which LU could help them bring to customers. Maybe LU takes out both COMS and ASND?
7. If I understand correctly, ASND ESOP shares are priced on January 31st and July 31st every year. The 7 point drop on 7/31/98 was a nice gift for some employees. And, when ASND's price recovers and presses towards 70-80, options for other employees will be looking good.
8. ASND had risen over 100% this year and people desperately didn't want to lose their profits. This exaggerated the Friday selloff.
9. SRA seems to have technology which ASND (LU?) needs and the $800M price (with $300M cash) seems reasonable. But, the 2500 SRA employees seem excessive. Could ASND sell off portions of SRA to make the deal even more attractive to ASND?
10. After the 30-day wash rule, momentum boys and nervous nellies can rebuy their shares on 9/1/98 for the upleg to the 10/1/98 LU due date and mid-10/98 ASND earnings acceleration. Maybe the 7/31/98 sell-off was exaggerated by the desire to avoid holding ASND during August (always a dangerous period) and to rebuy in Sept?
Well, now that Tim Luke is back, I'll go back to fulfilling my human virtual servant role and leave the daytrading to the specialists. Comments on any of the above points are much appreciated. djane |
