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Technology Stocks : Jimbo's Playhouse/CPQ -- Ignore unavailable to you. Want to Upgrade?

To: Mao II who wrote (8465)	12/24/2000 6:57:03 AM
From: Mao II	Respond to of 12663

Insider buying: Technology Insiders Becoming Bullish By Kevin Schwenger December 19, 2000 During October, insider sentiment across all industries became significantly less bearish compared to previous months. Whereas executives had sold approximately $26.00- and $21.00-worth of shares in August and September, respectively, for every $1.00 they acquired, this ratio fell to just over $6.00 sold for every $1.00 bought in October--the most bullish this indicator has been in two years. While the dollar value of shares sold declined in October, the dollar value of purchases rose to $321 million, its highest level since February. The technology sector has been especially hard-hit over the last nine months. A December 14th earnings warning by Microsoft Corp. (MSFT ) has heightened concerns that a sector rally may not be imminent. In fact, Wit SoundView analyst Arnie Berman called the announcement a "watershed event" because of Microsoft''s past financial predictability. Microsoft''s chief financial officer, John Connor, notes that the company is being impacted by weakened global economic conditions that are slowing not just PC sales but also corporate spending for technological goods and services in general. During recent months, technology insiders have started acquiring shares. Although this activity can be described as "nibbling" in most cases--we have yet to see widespread consensus buying in this sector--it hints that sentiment is more bullish overall than in the recent past. Purchasing activity at some of the largest technology companies throughout the sector has particularly intrigued us. In the PC space, Apple Computer Inc. (AAPL ) has experienced a 70 percent decrease in the price of its shares since the year began. A late-October purchase of 80,600 AAPL shares by Director Arthur Levinson was the first insider addition there in three years. With a market value of $1.6 million (he bought at prices between $18.81 and $20.34), Mr. Levinson''s trade was also the largest addition by an Apple insider to date, and occurred when the stock was down significantly from its March high of $75. AAPL shares subsequently slid to a 52-week low of $14.00 on December 6. In the domestic long distance market, WorldCom Inc. (WCOM ) is the nation''s No. 2 player. WCOM shares currently trade at $17.12, down approximately 65 percent since the end of 1999. The stock actually hit a three-year low of $14.25 on December 5. First Team All Star Director Francesco Galesi (Buy Score 95) picked up 127,650 WCOM shares between November 3-17 at prices ranging from $15.88 to $18.13. This primarily direct transaction was the first insider purchase here since March 1999. Mr. Galesi has been perfectly successful in predicting an upswing in the value of WCOM shares with his previous five additions--in the six months following those trades, the stock bounced back by an average 57.8 percent. Motorola Inc. (MOT ), the world''s No. 2 mobile phone manufacturer, had two insiders buying a combined 7,250 shares in mid-October at prices between $20.38 and $22.50. Directors Judy Lewent and Ronnie Chan increased their holdings by 5,000 and 2,250 shares, respectively. These were the first executive purchases at Motorola in six months, and the first consensus buying here in more than two years. At the time of these trades, MOT shares had declined 65 percent from an all-time high of $61.54 in March. The stock is currently down 60 percent for the year, after rebounding from a two-year low at the $15-level set on December 7. Lam Research Corp. (LRCX ) is a semiconductor equipment maker whose products are used by many major computer chipmakers. Its stock has shed 60 percent of its value this year. Director Grant Inman picked up 10,000 LRCX shares on October 18 at $16.68. Mr. Inman himself had made the most recent prior addition at the company two years earlier. LRCX shares set a 52-week low at the $13-level when the most recent buying occurred, after trading as high as $56.81 in April. At its current price of $15.31, the stock is down slightly from that level at which this insider traded. At Adaptec Inc. (ADPT ), a maker of computer-networking devices, its chief operating officer, Robert Schultz Jr., picked up 4,750 shares on October 30 at prices between $14.56 and $14.63. (Chief Financial Officer David Young subsequently picked up 600 shares in November at prices in the $13.00 to $15.00 range.) Adaptec executives had previously not increased their holdings on the open market in more than a year--in fact, Mr. Schultz himself made the most recent prior purchase in September 1999. His most recent transaction, worth $69,400, is the largest addition by an ADPT executive in over two years. At their current price of $8.94, a two-year low, ADPT shares are down 80 percent year-to-date. The recent buying may be a prelude to a recovery in the coming months as insider''s often purchase shares when they believe the market is undervaluing their company''s shares. However, with many tech stock prices down so significantly, we would like to see a greater number of executives stepping forward to increase their holdings at what appears to be potentially bargain prices. Message 15056357 M2

To: Mao II who wrote (8465)	12/24/2000 3:10:58 PM
From: Kenya AA	Respond to of 12663

M2: I admit I don't know much about risk arbitrage, but it sounds plausible except for the fact that JDSU postponed that shareholder meeting as of 12/18 (http://biz.yahoo.com/prnews/001218/ca_jds_sdl.html), JDSU was downgraded by Wachovia and "Crammer" hasn't written about JDSU since the 20th. Also, analyst "actions" during the day are fairly common. K