To: pat mudge who wrote (2571 ) 12/4/1999 1:33:00 PM From: Cyrus Mashhoodi Respond to of 24042
From Stockwinners.com JDS Uniphase (JDSU) is a high technology company that designs, develops, manufactures and distributes a comprehensive range of products for the growing fiberoptic communications market. These products are deployed by system manufacturers worldwide to develop advanced optical networks for the telecommunications and cable television industries. The firm recently announced a 2-for-1 stock split, payable on December 29. However, we are now hearing rumors that the board of directors may increase the split ratio from 2:1 to a higher level. Such an action could be announced at the annual stockholders meeting on December 16th. Adding weight to the rumor is the fact that the stock traded around $116, when the split was announced, but is now trading at $257 1/2. Does the firm have enough shares to increase the split level? Yes. On December 16, the Board of Directors will ask shareholders to approve an increase in the number of authorized shares from 300 to 600 million. As a result, the company could increase the split level. As announced earlier in the month, JDSU will buy Optical Coating (OCLI). The currency tendered will be JDSU shares. The transaction is only expected to cut into the number of JDSU authorized shares by just over 13 million, however, and would not preclude an increase in the split ratio. Although JDSU is currently down 8 1/2, we view this pullback as a buying opportunity. Brokers recommend shares with fourteen "strong buys" and thirteen "moderate buys". Over the past 52 weeks, JDSU has moved within the following range: $26 1/2 - 273 5/8. If you decide to invest, use a stop-loss of $229. Due to the relatively high price of JDSU, you may wish to invest by way of a call option. Take a look at the December $250 call (UQD_LJ). This option last traded at $20 1/2. (11/29/99)