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Technology Stocks : SDL, Inc. [Nasdaq: SDLI] -- Ignore unavailable to you. Want to Upgrade?

To: djia101362 who wrote (2400)	7/26/2000 4:52:03 PM
From: David E. Taylor	Respond to of 3951

djia101362: You guys are looking at the same thing from opposite ends. You're figuring out what % SDLI has to increase to reach the merger price given JDSU's present price. rel4490 is asking how far below the merger price SDLI presently is. Kind of like the optimistic Mark Haynes (rel4490) saying: "the market is 33 1/3% off its all time high", and the pessimistic Ron Insana (you) responding: "yes, but the market has to put back on 50% to reach its all time high". Ah, the math of discounts - this is how retail store discounts can suck you in! David T.

To: djia101362 who wrote (2400)	7/26/2000 4:57:44 PM
From: Gerald Walls	Read Replies (2) \| Respond to of 3951

I think my math is fine. The discount is calculated like this. You compute discount or premium by dividing the current price of an item by what it "should" be. Hence: SDLI / (JDSU * 3.8) 390 / (138 * 3.8) = 0.7437 So SLDI is trading at 74.37% of what it "should", which is a discount of 24.63%. What you're computing is the additional percentage profit that would be made if you own SDLI instead of JDSU and the merger goes through. This isn't the same thing. With your equation you can have discounts of over 100%, which isn't possible: (100 - 25) / 25 = 300%