SQNT - Sequent Computer $13.69 (+1.12)(P3W+3.56)
70% of SQNT's sales come from Sequent's NUMA-Q technology,
which provides a more efficient way of linking symmetric
multiprocessing (SMP) technology, a technology in which
their high-end open system servers are based. Internet
business communications and on-line transaction processing
are types of applications that call for the power and
reliability that Sequent's systems provide. Prominent
users of Sequent's products include Carlson Hospitality
(cruises) and Boeing. Among others, they are allied with 3
of the big 4 software heavyweights, including Microsoft,
Oracle and Sun (Digital Equipment), whom they also stated
in yesterday's shareholder meeting was their biggest
competitor. (Hmmm. . .who is the fourth one? IBM?)
Slightly less than 50% of the company's sales are made
internationally.
There's nothing like a good old-fashioned rumor to pique
the interest of a swash-buckling high-risk trader. To that
end, we offer up this play on the rumor that SQNT will
announce an alliance or an OEM agreement with IBM in the
next 2 weeks. SQNT's products would certainly be a nice
fit with IBM's e-commerce goals for the future (they are
already working on a project to be delivered in 2000).
Though the play could be a real winner, it also falls into
the EXTREME RISK category. If the alliance or OEM
agreement never happens, or is delayed, you could lose your
money. Also, though it's been mentioned in the Yahoo!
message boards, it isn't getting much play right now.
However, lending some credibility to the rumor, volume has
been unusually high. The point is that the rumor is
unsubstantiated, making this an EXTREMELY RISKY play!
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