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Technology Stocks : Compaq

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To: Elwood P. Dowd who wrote (60658)5/6/1999 4:42:00 PM
From: rupert1  Read Replies (2) of 97611
 
El: On the surface it looks like a number of buyers know something positive is to be announced. If that is true, it is annoying. We have just been told by Rosen that they will ensure that everybody gets news at the same time. Here are a number of possible reasons for today's heavy volume and price rise.

1. It reflects heavy short-term call activity.
2. High call activity is based on institutional judgement that the bottom has been reached and positions have to be strengthened for the next 3-6 months.

3. A major brokerage house is about to issue an upgrade, and its clients are buying today in anticipation of a pop.
4. There has been a CC giving analysts positive guidance, and this has prompted buying by their own firms.

5. If an announcement, these are the candidates in order of probability:

(a) Major partnership - e.g. with Radio Shack.
(b) AV major partnership with content provider.
(c) Enlarged share buy-back announcement.
(d) Provisional schedule for AV i.e. when it will be ready for first IPO filing, when likely to receive SEC approval, window when most likely to be floated. There may also be some general principles, without the details, of equity structure.
(d) New product announcement.
(e) New channel announcement.
(f) New CEO announcement.
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