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

To: carl a. mehr who wrote (33135)	11/8/1999 11:20:00 AM
From: Valley Girl	Read Replies (3) \| Respond to of 74651

You and the other brave defenders of this stock are welcome to them, and I hope you make money on your side of the bargain. 60 million shares! Massive short-covering helping to lift it. This stock is, compared to other Nasdaq blue chips, a bargain here, neglecting the legal uncertainties of course. We need that settlement, Mr. Gates. Then this stock will spring like a panther to $100+. Otherwise, a trading range I expect. You should note that, as I indicated in my post last night, my intent is to take whatever comes with my core holding, some 24000 shares, for which a sale of more than token amounts is impractical tax-wise. I sold 4000 shares at 89; they were acquired during the most recent dip down to the 70s - trading shares, if you will. Alas, it left me overweighted in the stock; feels better to be out of them with a small gain. I'll pay 50% of the profits to feed the welfare state. I got greedy and was (until Friday) holding out for that run into the 100s. I should have sold in the mid-90s. Ah, well. Time for a coffee. Cheers!

To: carl a. mehr who wrote (33135)	11/9/1999 2:59:00 PM
From: Valley Girl	Respond to of 74651

Dear, dear Carl: Well, my friend, where do we go from here? Trading range? Slowly sinking to retest the high 70s or does that require Judge Wapner's next insightful epistle? Surely no rebound without some good news on the settlement front? I've been mulling over possible futures and have come up with two, curious to know what you who bought the stock yesterday think. Scenario A: Gates settles the case, possibly on terms favourable to Uncle Sam. No breakup, tho. Stock soars on the news. If P/E equals SUNW (75, apologies for the error in my post Sunday, it was late at night), translates to $110. Scenario B: Gates gambles to win on appeal. Second shoe drops; MSFT found guilty on several counts (inevitable without a settlement). Stock drops to the high 70s on news. Third shoe (penalties) to come in early 2000. Stock at best trades sideways during this period. Lengthy appeals process begins; with further bad news now years away, and FY2000 earnings rolling in, stock begins to recover (ah, but to where?). Of course, with each passing week the market would likely assess the odds of "B" unfolding as higher and higher, and I would guess that would slowly let air out of the stock in anticipation (rather than, say, trading the stock in the low-mid 90s right up until the next legal bombshell and then hammering it the day after). Just reinforces my feeling that Mr. Gates has to settle. Musings on the business: Many posters here have pointed out that even absent MSFT's current legal woes, they're in a competitive dog fight to sustain their earnings in new product spaces and markets (e.g. handhelds, web servers, TV-based appliances, on-line services). Although I personally don't think these markets will cause declines in PC demand (I view them as additive), they might be the keys to sustaining high earnings growth into the future. MSFT has never been particularly innovative, but their reaction and execution have till now been near-flawless. Yet, as I wander around in stores and cast about the web, MSFT seems almost invisible in these new markets. I can't believe this is due to stupidity, so I'm wondering if this accursed court battle has them gun-shy. For example, I would have expected to see them market and price MSN much more aggressively, rather than cede the market to AOL. I might have expected them to open up the warchest, buy up a cellular technology company, and market a CE-based cellular palmtop of their own. (As far as I can tell their hardware business is limited to mice, keyboards, joysticks and such.) Well you get my point; my thus-far unshakeable faith in MSFT is due in no small measure to confidence in the management. They don't seem to have done much lately to reinforce that faith.