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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: RAY WACLAWSKY who wrote (7689)	11/10/1997 3:54:00 PM
From: Bill Lin	Read Replies (2) \| Respond to of 14577

ray, how can i misread the 10q when it said that undiluted and fully diluted shares are BOTH 52.3mm? are you saying that the 103.5mm sub conv. debt was converted? well, NOOO it wasn't cause its still there on the balance sheet. shares went up 2.3mm or so (i forgot what i calculated) because of exercise of options or else they counted these options as actual shares since the $2-10 strike prices are "in the money" (back then). the strike price of the conv. debt is "like" an option. so the FASB rule that you can exclude these shares is what S3 applies. you are right, it is not a conservative way to account for dilutive shares. the numbers are hidden. it SMACKS of flim flammery, following the letter of the law. If S3 were really up front, they would include the dilutive share amount and keep it steady, instead of changing it every quarter. (it bounced from 46mm to 52.3mm in last 3 qtrs.) calculated shares will fluctuate because of the closeness of the strike price, but the fully diluted shares should not change so much. ray, try this, look through the last 3 10q's and the last 3 earnings press releases. then figure out how many shares are 1) issued, 2) optioned, 3)promised. then figure out what the share numbers on those reports mean... its confusing... i gave up. hope you have more success. BL ps you and other "high risk" investors in hi tech (me too) will be in a wild ride for the next 3 months, as the "excess inventory" theory starts to permeate around Christmas selling season. You can bet the shorts will spread this as thick as peanut butter. so far, its only a whisper. another element why i think S3 can dive even more.