To: Jenna who wrote (1725 ) 1/15/2001 12:55:23 PM From: Jenna Read Replies (2) | Respond to e-mail: AMCC marketgems.com One of the 'most asked for stock analysis'. Although AMCC was a recent long play and once again triggered at 68 12/ Granted the daily chart is showing improving technicals and even a possible trend reversal to the upside, AMCC is under accumulation and the next resistance is at 76, AMCC is trading above its 20 and 50 day rising moving averages, MACD is bullish,volume patterns are showing money is flowing into AMCC, so what is the problem? BIG PROBLEM ... I don't see the current valuation justified. Earnings outlook and growth going forward can't possibly be sustained and that is the needle that might prick the AMCC bubble as well as other overvalued companies in the tech sector about to report in the next few weeks. I am looking for the AMCC 70/65 puts for January or even February, after a possible move to the upside on Tuesday after the first and maybe second reversal period... a P/E multiple of 304 in a market climate that MRK sports a P/E of 28 and a higher growth rate to boot, I don't think AMCC will make it. I might decide to go flat and wait for earnings but my tendency is to opt for both JNPR and AMCC puts. JNPR was already down 100 points since we started shorting it and there is no reason to believe anything has changed. I still like both companies and after they have a possible final correction (10 to 20%), I would buy for a longer time hold. Again if there is a problem and still any doubt I would suggest staying on the sidelines until after the earnings report. We are not die hard shorters, so we won't go out on a limb but the bias is looking to me like further corrections are in the wings.
