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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: JesseK who wrote (6669)	8/19/1999 12:42:00 AM
From: Ron C	Read Replies (1) \| Respond to of 60323

Hopefully Aus is in a Sushi house somewhere enjoying his family and allowing the rest of the thread to manage the rigors of SNDK. No doubt the powers that be are creating the dilution for a reason. So far Mr.Harari & Co. have used their talent and business sense to create a formidable technology.I believe speculation can only cause more uncertainty and restlessness in a very sound company. Everyone in this thread brings about sound points. I would like to get a response from Art on this particular "dilutive play". Ron <long> 82+

To: JesseK who wrote (6669)	8/22/1999 7:28:00 PM
From: Ausdauer	Read Replies (4) \| Respond to of 60323

Jesse, You stated... Where is Ausdauer?? We need him to sort this out. This offering is dilutive no matter how you look at it. I was very surprised to see only 2 new press releases in the last 3 to 4 weeks. The rapid rise in the stock's value may be related to the flash wafer shortage and SanDisk's announcement to raise cash to expand raw material supplies. What seems odd to me that they wish to raise so much cash with a stock offering given cash on hand and the previous amount of cash expended on foundry agreements. If we use $51 million as a precedent, this cash derived from the "tertiary" is excessive. I have always been impressed with Eli & co's streamlining of production costs by not owning a foundry outright and by contracting out assembly. And while I hope they are able to get wafer production up in concert with market demand, I would be somewhat concerned if they actually go out and create their own foundry from the ground up. It seems contrary to their previous business ojectives. The issuing of new stock is by definition dilutive, with the (substantial) value being added to the balance sheet at the expense of quarterly earnings growth. This is particularly concerning given the 3 stock option programs that were ratified last Spring. The cummulative effects of these actions will obviously require more rapid increases in revenues in the next several quarters. Thus, the potential for the average sushi-eating stockholder to get hurt is increased in coming quarters, especially if the stock issuing does not correspond to a timely increase in raw product availability. The effects of dilution are concerning to me. Currently we are at a stock price which I never anticipated. My hopes of $60 to $80/share by Christmas and $150-180/share in the next two years or so are way ahead of schedule. It is tempting to take some money off the table at this point, but it goes against my priniciple of keeping SanDisk as a hearty perennial in my investment garden... ...and I always seem to sell my winners way to soon. Ausdauer (equally confused as the rest of the Thread)