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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: kcmike who wrote (43941)	7/15/2000 4:37:25 PM
From: miklosh	Read Replies (1) \| Respond to of 45548

Hi Mike. <COMS (sans PALM) has run up very little in that time. > I understand what you're saying . I was talking about coms, not COMS (sans PALM). In fact, COMS sans palm (not comsv (please note the distinctions below) has gone down in price in that time, but imo this just supports the notion, that EB and COMSV are bad news bears. <I am not sure I understand your comments about the run up in COMS being due to sudden realization that the 1/1.484 ratio is now fact.> I think that the latest run in Palm (dragging coms' sorry but along for the ride)is due to: 1- the hopes that the street has for palm 2- an accelerating sense of relief that palm will actually be divested of a historically poorly managed company once and for all. This,along with the recent decline in coms (sans palm) speaks to EB's ongoing lack of credibility. 3- Now that the street knows that EB's gonna give us a 1.484 ratio,not 1.3or 0.8 or 0.00001 <G>, the coms shorts are running scared because they are betting that coms shareholders will not dump their coms. I honestly think that many coms shareholders were dubious that they would ever receive 1.5:1 shares of palm. I know I was. If the deal would have closed at 1:1 or worse, irate coms holders would have dumped their shares, pushing down palmv along with coms. Until recently, this fear was built into the COMS(coms+palm) price imo, so the recent sharp ascent in COMS(not coms sans palm)in no small part reflects a sense of relief that we will get our palm shares at the ratio as promised. As far as the numbers go: <To use your time frame, PALM was 31.9 on 7/3, and COMS was 45.4. On 7/14, PALM closed at 55.9375 and COMS closed at 73.65> Hmmm.. Mike, my time frame was 12 TRADING days ago. Here are the numbers: June 28 July 14 palm 26.38 45.44 coms 48.13 73.63 73.63 / 48.13 = 1.53 Yup, that's a 53% increase in the price of COMS over the last 12 trading days. It is true however that palm ran up 72% in the same time frame, so as you mentioned, the palm component of coms was responsible for the run up in coms. Good point! <If you apply the 1.484 ratio, then COMS sans PALM has only "run up" less that 2 1/2 points> In fact when I plug in the above dates, coms sans palm has actually lost value over that time! -$2.78 palm x ratio = palm component of coms coms - palm component = coms w/o palm June 28 26.38 x 1.484 = 39.15 48.13 - 39.15 = 8.98 July 14 45.44 x 1.484 = 67.43 73.63 - 67.43 = 6.20 8.98 - 6.20 = (2.78) Even with the ratio and date set, there still exists disparities with comsv vs coms minus palm, and palm vs palmv. There are many players out there looking for arbitrage opportunities. What a mess<G>! I,m still on the fence with palm. I like their idea of keep it simple vs msfts' lets pack a pc with a cumbersome os in your pocket approach. But then, I still think beta is better than vhs<G>. I am also concerned that palm may loose market share. So my personal choice will likely be to wait, (and probably lose potential profit) for palms' management, not just the product, to prove itself for a little longer. Best of luck Mike Mike