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Technology Stocks : John, Mike & Tom's Wild World of Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (2367)	6/12/2001 5:35:19 PM
From: John Pitera	Respond to of 2850

thanks for that, and I agree we'll see some more weakness in PMCS and AMCC. I think that Michael Cahill's theory of CAPEX spending weakness is playing out regarding JNPR, AMCC and PMCS Message 15792070 Your number was represented by Michael Cahill, a brainy young guy who is shorting telecom tech, specifically Juniper (JNPR:Nasdaq - news - boards), Broadcom (BRCM:Nasdaq - news - boards) and PMC-Sierra (PMCS:Nasdaq - news - boards). He's keying off this group for one main reason. As a high-yield bond expert, Cahill has tracked how the bonds of the buyers of these goods, the telcos, are trading. Right now he says a massive number of these bonds are trading at levels that indicate there are many more defaults coming. Given that, he doesn't believe that capital expenditures, which he thinks will fall 17% this year, are going to rise in 2002. (Most think that they will.) In fact, he thinks that 2002 will be far worse than 2001. Given that view, he wonders how these three stocks, which are trading at 10 times next year's estimated revenues, can possibly make the estimates.