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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Dan3 who wrote (228283)	3/17/2007 8:13:16 AM
From: aleph0	Respond to of 275872

Dan3 .. I agree with your viewpoint. That was my whole point about my thesis : P/E + Public offering. If a company with $5 Billion in assets issues $5 Billion in stock to pay for an additional $5 Billion in assets, each stock share continues to "own" the same value in assets. If a company's stock price is depressed due to doubts that it will be able to finance continued expansion, and it then sells new shares of stock that finance continued expansion, the price may go up because the doubt is gone (risk has been removed I am still waiting for the announcement ! The current 14$ trading-flat-platform is imo obviously a Key. a) either Short positions are being taken up, whilst carefully holding the price at 14$ b) a 3rd. party is accumulating for D-Day. c) a possible drop in the stock-price is usual for such announcements, hence the Short positions. My guess is that a P/E investment coupled with a public offering will great support againt a possibly too-aggressive stock-price depreciation - due to the typical WS & Public reaction to such news.

To: Dan3 who wrote (228283)	3/17/2007 4:41:56 PM
From: niceguy767	Read Replies (1) \| Respond to of 275872

It's kinda tough for a company that is suffering financial difficulty (i.e. looking at $100M to $200M losses in each of the next 2 quarters) to find buyers of common shares to reduce its debt load and not experience some significant negative price impact on current price, i.e. $14. The best reason for selling common is for expansion or to build a war chest for expansion. In such cases, the positive case makes some sense. It's too late for AMD to sell the sizzle of the ATI deal and in retrospect, it looks like AMD paid about 2X what ATI was worth. What I'm getting at is that the idea of floating a $2.5B offering of $14 common shares just doesn't fly for me given the current state of financial hardship at AMD. Seems to me that any large investor in AMD at this point will demand something more than common shares for taking on such significant risk. I'm guessing convertible shares and with a hefty coupon rate and I wouldn't be betting on those to hold AMD at $14, once the "issue buzz" were to subside. The re-energized level of competition from INTC combined with the current "financial pickle" that AMD finds itself in doesn't make and significant new offering, convertible or other, a slam dunk at $14 by any means.

To: Dan3 who wrote (228283)	3/18/2007 11:23:53 PM
From: Tenchusatsu	Read Replies (1) \| Respond to of 275872

Dan, > If a company with $5 Billion in assets issues $5 Billion in stock to pay for an additional $5 Billion in assets, each stock share continues to "own" the same value in assets. But then each stock share represents a lower portion of the earnings. Which is fine if a doubling of assets leads to a doubling of earnings, but that's highly in doubt with AMD these days. Tenchusatsu