something else for the GMGC mix
=General Magic Up -3: Hldrs Selling Despite Takeover Rumor
Not everyone appears to be buying into the takeover rumors.
Low-priced stocks like General Magic often experience intense volatility, said Lewis
Alton, an analyst for L.H. Alton & Co.
Meanwhile, documents filed with the Securities and Exchange Commission last week
showed that 14 General Magic investors have registered to sell more than 21 million
shares of common stock obtained in a conversion. The list included Microsoft, which
registered to sell 2.7 million shares of its 3.6 million share stake.
"If things were so great, you would not be selling the stock," said Jeff Matthews,
portfolio manager for Ram Partners.
General Magic went public with much fanfare in December 1995, and saw its stock shoot
from 14 to 32 on the first day of trading. At the time, the company was marketing its
Magic Cap communications software to Motorola and Sony for use in hand-held computer
devices.
The rising popularity of the Internet, however, foiled that business model. And the
company eventually revamped, shifting its focus to marketing a virtual assistant service,
known as Portico, that allows users to access voice mail, e-mail, stock data and calendar
and address-book information via a telephone.
General Magic shares fell to a 52-week low two months ago as the company was unable to
meet investor expectations for service agreements with major telecommunications
companies. Instead, investors had to contend with the company's announcement that its
fourth-quarter loss had widened from a year earlier.
General Magic reported a loss of 51 cents a share for the period, including charges,
compared with a 34-cent loss a year earlier.
First-quarter earnings are slated to be announced next week. A conference call has
been scheduled for the event and speculation has it that news from the call will be
"exciting and positive," Alton said.
- Johanna Bennett; 201-938-5670
(END) DOW JONES NEWS 05-03-99
04:38 PM
david |
