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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (11317)	10/18/2000 5:00:51 PM
From: sjemmeri	Respond to of 78614

Many of the recently downtrodden tech growth stocks still have high option premiums so a value investor can consider selling the volatility to someone else. I bought COVD today at 4 and sold Mar 7.50 calls at 1 1/4. I have 30% of my initial outlay back in hand and still get to keep the first 90% of upside if the tech market does rebound quickly.

To: Paul Senior who wrote (11317)	10/18/2000 6:11:58 PM
From: Tomato	Read Replies (1) \| Respond to of 78614

Apparently SKO's debt is something to think/worry about: NEW YORK (Dow Jones)--Fitch Thursday has changed its rating outlook on Shopko (SKO, news, msgs) to negative from stable. The BBB rating on Shopko's $475 million bank credit agreement and $340 million senior notes is affirmed. Fitch said, "The company recently announced that earnings for the third quarter and full year would be below expectations as a result of weakening conditions of the retail environment. As part of the company's announcement, SKO plans to reduce capital spending by approximately $80-$100 million next year, reduce overall costs by $15-$20 million and continue to aggressively manage inventories. Cost savings will likely be used to retire long-term debt. "While these cost saving measures are positive, there is still uncertainty surrounding the retail environment. Fitch's change in outlook reflects SKO's competitive environment, deteriorating credit fundamentals and higher debt balances. Reduced leverage should improve interest expense, however, increasing competition and the potential for price reductions could affect operating margins. Finally, like most retailers, Shopko generates a substantial portion of its operating income during the fourth quarter, thus the ability to maintain margins over the next three months will be a key indicator to overall EBITDA," the rating agency said. Quote for referenced ticker symbols: SKO © 2000 Dow Jones & Company, Inc. All Rights Reserved NEW YORK (Dow Jones)--Moody's Investors Service on Wednesday confirmed the Baa3 senior unsecured rating of Shopko Stores, Inc. (SKO, news, msgs), but changed the rating outlook from positive to stable. The revision in the outlook is based on an expectation of continued sluggish comparable store sales growth and the likelihood that Shopko's announced reduction in new store construction will limit overall sales growth, Moody's said. The rating confirmation reflects the company's strong management and its stated intention to use free cash flow for the purposes of further debt reductions, it added. Ratings confirmed: Senior unsecured debt at Baa3; $200 million revolving credit agreement, due 2002, and $175 million revolving credit agreement, due 2001, at Baa3; senior unsecured shelf registration at (P, news, msgs) Baa3. Rating outlook: Stable.