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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (40289)	3/12/2002 10:19:02 PM
From: mishedlo	Read Replies (1) \| Respond to of 99280

Well after laughing at that play, and I it still seems quite odd selling those puts, an odd thought struck me. Perhaps the intent was to force the price to some unreasonable level. To avoud losing 40 cents * 7.5M, the MMs might want to try and put those shares to the hedge fund. If that does not happen the hedge fund collects .40 * 7.5M (which is not a bad chunk of change). If this quarter is a one time anomoly (I question this from looking at the chart), then perhaps CMVT is a steal at these prices, and the hedge fund gets the MMs to do something it can not do in its own accord (force the price to some really cheap level). Trailing 12 month earnings are $1 (which seems pretty good). But last couple quarters were not good. The question is where do we go from here? From YHOO biz.yahoo.com CMVT has 9.64 in cash! How bad is that? My big worry would be the debt to equity ratio, not horrible but certainly not very good (I perfer companies with no debt at all). However, I am sure 9.64 should tide them over for quite a long time. Other than that I do not know how to ascertain the fundamentals of the company. I thought those were March PUTs but a double check shows that those were April PUTs. This gives the MM or seller a clear incentive to hold the price low until April Expiry, but it also give the hedge fund reason to prop the stock up in the meantime. M