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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Glenn D. Rudolph who wrote (74779)	1/28/2000 5:22:00 PM
From: Thomas M.	Respond to of 132070

MU sux. <g> Tom

To: Glenn D. Rudolph who wrote (74779)	1/28/2000 5:23:00 PM
From: Knighty Tin	Read Replies (1) \| Respond to of 132070

Glenn, I will give my opinion, though you will probably hear others as well. Last quarter MU had one of its few profitable quarters in the past 3 years and this quarter may also be profitable, albeit at a much lower level. Then we return to the old pattern of losses as the PC industry is being hurt. One of the first places the pc boxmakers have turned to cut costs is in the amount of DRAM provided to users. Since there is not any noticeable difference between a machine with 128MB and one with 64MB, at least not for the most common apps, they can cut back without very many people noticing. At the same time, DRAM prices are collapsing, though they have occasional stutter steps upward. The basic problem is that there is too much DRAM capacity. The industry goes through periods of capacity closings that raise the prices, but, then, they reopen and take the prices back down. What you have is something like the steel industry with very high PE ratios for no discernible reason. I own long puts on MU and am very happy today. <g>

To: Glenn D. Rudolph who wrote (74779)	1/29/2000 1:05:00 AM
From: Earlie	Read Replies (2) \| Respond to of 132070

Glenn: MU is a true "darling stock" hence it frequently trades at prices that do not reflect its worrisome fundamentals. The company produced a rare item last quarter,... profitability, primarily because the box builders triple ordered this fall, somehow persuading themselves that their semi suppliers might not be ready for Y2K. Dumb,... and expensive. They paid inflated prices and now they have semi product sitting on the inventory shelves even as the current prices fall off a cliff. Prices for 64 Mbit chips, a primary product at MU, have fallen from $15. last fall, to a current $7. No bottom in sight. I expect to see under $4 before summer. Their all-up cost to produce is well above this latter number. MU also plays games with its debt. It has not paid interest on $500.0 million borrowed 21/2 years ago (first payments may have been paid in December). It also has far too much capacity. The company's engineering troops are long-suffering and hard working, but the company is definitely second tier with respect to leading edge technology. The company must soon invest serious bucks in new production technology if it hopes to stay in the game, but an analysis of its balance sheet suggests that it simply is in no position to so do, unless capital can be raised. The company is ok, the stock price is insane. DOOTM puts make good sense to me, especially if modestly attacked in the early going. The stock price will likely require more than just a bit of bad news to acquire some downside momentum. Best, Earlie