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Technology Stocks : Broadcom (BRCM) -- Ignore unavailable to you. Want to Upgrade?

To: Keith A Walker who wrote (5997)	7/2/2001 11:57:40 PM
From: Stoctrash	Respond to of 6531

Keith...the key IMO is the "days to cover", short ratio...etc. Short Ratio for BRCuMingdown is 1.04 which means 1.04 avg days of trading is needed for and every short to cover. No chance of a short squeeze with this type. Look for ones with 5-10-20 days needed = more likely prospects. I think your best bet is to watch the options on it. Look for blocks of calls to be sold and puts to be bought or vice versa etc etc..of course this might be useless as well <GG>

To: Keith A Walker who wrote (5997)	7/3/2001 12:25:32 PM
From: Raymond Duray	Read Replies (1) \| Respond to of 6531

Hi Keith, Re: One other assumption I am making in the above scenario is that $100 is a fair price for BRCM. If no one in the future believes that it is, then the shorts can rest easy for a while. Today, IMHO, stocks do not trade on intrinsic value, i.e. what income they can produce for the stockholder via dividends and/or unit trust income. They trade on the hope that the bigger fool theory is intact, which it clearly is not. So, $100 for this depreciating, diluting asset class is a real stretch for a skeptical guy like me to swallow. Remember, the story here is blown. The extraordinary valuations of the past were based on exceptional PEG ratios and the view that BRCM was a leader in future industries. All of these assumptions have been blown out of the water. The E of the PEG is no longer in the stellar league of an INTC or MSFT. In fact, it's headed into the toilet. What appeared to be growth, turned out to be violent cyclicality, and the industries that BRCM was applying itself to are now all applying the brakes on advancing the technology. So, in short, the story is stale, and the true intrinsic value of this puppy is an order of magnitude lower than $100, IMVHO. Of course, Mr. Market has a way of making fools of those who would be too rational about all this. As we both well know. Best, Ray :)