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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: eplace who wrote (99523)	3/22/2000 10:33:00 PM
From: niceguy767	Respond to of 1580111

eplace: Re: "Is there a point where you would bail on your April calls? Also does the Taiwan situation figure into any of your thinking? Comment: Taiwan situation is not a factor in my analysis at the moment. Exit point on April call options comes after earnings and will probably be rolled into July options...Given the significant AMD undervaluation, 3 month calls can be purchased relatively safely at any point under $100...A review of the 3 month graph suggests to me that once through $60, the upper short term limit is $90 to $100...this limit could be reached very quickly if either Q1 earnings are perceived to be greater than $1.00 or if they are posted at $1.00 or better on April 12...According to my assumptions, I'd say a Q1 of $1.00 or better has a 50/50 probability of occurring so I'm hanging on to my April calls...I fully expect to see AMD at $70 (minimum) prior to their expiry and I am not counting out $90 to $100 as a possibility! My worst case Q1 eps scenario is $0.54 and my best case is $1.60...My epscontest.com estimate of $1.07 is the average of worst and best case scenario...Incidentally, the worst case of $0.54, about $0.10 above street estimates, could easily support a $70 price!

To: eplace who wrote (99523)	3/23/2000 9:35:00 AM
From: niceguy767	Respond to of 1580111

eplace: Re: "I think it is more than coincidental that we both purchased our options at the same time the other morning. What did you base your trade on? I was going by the charts that said we had broken out of a short term downward trend." Comment: The charts strongly indicated that at $50 AMD was oversold last Friday...Concerning longer term upside potential, the current rule of thumb (still in development stage) is that each increment of 1 million Athys adds betwee $0.50 to $1.00 to eps...Mr. Sanders recent Y2000 upward revision to 13 million Athys indicates that inremental Athys of at least 10 million will be sold in Y2000. Assuming each additional million Athys adds $0.75 to AMD eps, it follows that, assuming constant flash profit contribution, that AMD eps will increase by $7.50 from Q4 $0.43 to $8.00 before taxes...(and $0.75 eps increment per 1 million Athys might be low!). It is remarkable that Q1, which is the seasonally low quarter, will produce revenues exceeding $1 billion, which in turn exceeds AMD's record Q4 $970 million in revenues. Any increase in Q1 eps over Q4 will be attributable in no small way to incremental Q1 Athy sales...epscontest.com Athy estimates average Q1 Athys atabout 1.6 million, representing an increment of 800,000 Athys in Q1, which implies a Q1 eps of over $1.00 using the $0.75/million Athy formula.