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Technology Stocks : Alliance Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: Woody_Nickels who wrote (5185)	6/29/1999 10:28:00 AM
From: Charles R	Respond to of 9582

Ken, <I've heard of DayTrading, but DayGrading is ridiculous! > In case you are not aware, Tad LaFouintain is the analyst and he frequents SI - may be he will have something to say. He is a value oriented guy who changes his ratings depending on the stock prices but gotto admit - his style and the whipsaw is pretty unusual. Chuck

To: Woody_Nickels who wrote (5185)	6/29/1999 10:52:00 AM
From: A. A. LaFountain III	Read Replies (2) \| Respond to of 9582

Ken: re "DayGrading" Nice word play. Now about my shifts in ratings...as I have explained on some other threads on SI, my ratings are solely driven by the relationship of the stock price to my 12-month target. That "target" is a projected value that I generally derive from the EPS growth rate. However, in the case of ALSC, I am using a methodology based on the asset valuation (and it's probably a conservative valuation, but I can live with that). In any event, when there is 35% or more potential gain to my target, the stock merits a Strong Buy. Should the potential gain decline to less than 20% (either due to share price appreciation or an adjustment to the "target"), I lower the stock to a Buy. In this particular instance, I had lowered my rating to a Buy last week when the stock was up over $10 and my target was only slightly higher. I have decided that the probability factor for the closure of the UMC deal was too low, and have moved it up from 2/3 to 85% (this is fairly arbitrary, but so be it), which more than offsets the decline in UMC stock price from where the target was calculated last week. With the stock off 10%, the spread between the now lower stock price and the now higher target ($12.50) was enough to justify the rating change. There are times when the relatively small percentage point change between a 35% potential gain and a 20% potential gain can make this process seem a little screwy (particularly when dealing with a low-priced stock). However, it is consistent...and I feel that a disciplined approach is inherently better than willy-nilly. - Tad LaFountain