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Technology Stocks : Ciena (CIEN)

CIEN 202.50

+0.8%

Dec 2 4:00 PM EST

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To: Doug Gallian who wrote (5038)	11/2/1998 8:39:00 PM
From: DanZ	Read Replies (2) of 12623

Doug, If you want an example of what can happen to a stock when a rumored takeover doesn't go through, look a look at a chart of VLSI between June 22 and June 29. The stock rose on rumors that LSI would make a $28 offer for the company. Joe Kernan even mentioned it on CNBC. A few days later, LSI bought Symbian and the rumor premium came flying out of the stock. It ran from 16 to 20 on the rumor and back to 16 after the rumor was dead. BTW, the LSI deal was actually on but VLSI's CEO killed it at the last minute. The morale of the story is buying stocks based on takeover rumors is risky business. If the takeover doesn't occur, the stock will most likely return to where it was before the takeover first surfaced. I'm short CIEN because I don't think they are in play right now. If I'm wrong, I lose. If I'm right, I'll probably make money. I'm not here to make any enemies, just to share what I see. The gentleman with the $20 stop is being smart. This stock is extended and only up on speculation. If you are long, I hope you don't let your profit evaporate. At least protect your profit with a stop if you don't sell the stock outright. Good luck to all. Dan

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