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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Northern Cougar who wrote (92825)	4/11/2000 8:56:00 PM
From: Jenna	Read Replies (2) \| Respond to of 120523

Short plays: contrary to popular opinion INTV and CHKP will probably give shorters a chance tomorrow. I would not necessarily be short CHKP through earnings but I would expect CHKP to sell off even after a 'correction of sorts'..which was not that convincing. INTV might gap a little up but I would short into the gap. When I sold ADTN on Monday, I was tempted to short but held back. What happened to ADTN was simply selling off but ADTN was nicely upgraded today and reacted as it should after an 'uncomplicated' earnings report. ADTN has a peg of 1.56, CHKP has a peg of 3.30. ADTN trades at a 49% Discount PE Multiple of 39.9 x earnings, vs. the 78.1 X average multiple at which the Communications Equipment SubIndustry is priced. CHKP trades at a 89% Premium PE Multiple of 108.7 X, vs. the 57.5 X average multiple at which the Software & Services SubIndustry is priced INTV shorter will probably have to cover in the early morning but after 20 or 30 minutes I would consider shorting any rally. CHKP might move up in anticipation but IMHO shorting the 'day after earnings report' will be risky but most likely profitable. This is by no means anything but conjecture based on 'history repeating itself'.. I am neither long or short INTV or CHKP. Valuations are still extremely high for CHKP and this stock looks like a carbon copy of YHOO and MOT.. Its not enough to beat estimates, you have to be fairly valued AND beat estimates. If valuations are 'blown up' the stock will sell off.