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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Just_Observing who wrote (28987)	9/1/1999 4:52:00 PM
From: johnd	Read Replies (1) \| Respond to of 74651

Taking a longer term view on MSFT, I feel fiscal 2001 and fiscal 2002 should be solid considering corporations deployment of windows2000, deeper inroads into server and business app software markets. However, fiscal year 2000 looks very weak. There would be softness in NT markets as customers wait for Win2000 (Microsoft predicted growth rates will be 1/3rd of what it was last year in the NT segment). The new Star office from Sun poses some danger to retail sales of office2000 as well as some pricing pressures. I worry about several analysts feeling it will chip away at office sales. Last night I asked several people to get a feel on this. Lot of people I talked liked the star office, free product and does a lot of things needed for home use. This is a bit dangerous. There will be good opportunities for accumulating microsoft at cheaper prices: (a) Possibly around Novemebr or December when Jackson rules (May be a 15% drop) (b) Possibly the Y2K sell-off that I still expect. I still feel MSFT will touch 10 to 15 points lower from where it is now some time from now to December. The reason for that again is that it could easily hit 55 trailing PE on a 1.5 trailing eps or about 78-82 sometime in next 4 months. Currently at 92 it boasts a PE of 66 or so. Not cheap by historical measures. The presentations and conference call from a month ago are still eachoing in my ears: "Earnings growth rates in single digits" "Margins will not grow" "NT groth will be a third" "Our valuations are too high" Some of you will say this is routine. But the statements are strong enough that they cannot be ingnored.

To: Just_Observing who wrote (28987)	9/1/1999 5:06:00 PM
From: t2	Respond to of 74651

Does MSFT have a specific day of the year that they sell their puts or do they time them based on the stock price. If you are selling puts, then you want to sell them when the stock is down. If MSFT times their sales of puts then this is a bullish indicator I just don't know when they sell and i can't make it out on their statements. The interesting thing is that the strike price is 70. This is only slightly higher than the 59 to 65 indicated on the March Form 10-Q. I have not checked the June earnings release but i think that there was no change in the 59 to 65 prices. The current puts at 70 would be a very logical increase from the high of 65. The price of 70 is another reason that makes me certain it is Microsoft directly or indirectly selling the puts.