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Strategies & Market Trends : Roger's 1997 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Pancho Villa who wrote (8189)	12/11/1997 6:01:00 PM
From: Bill Wexler	Read Replies (4) \| Respond to of 9285

I'm going to pound the table on AOL and YHOO... I'm going out on a limb here because I thought Yahoo was a great short at 35 and 47 (pre-split), and it is now 90 (pre-split). However... We can all agree that both of these companies are ridiculously overvalued. I believe the basic problem here is that they have simply become momentum stocks, i.e. people buy them because they have good stories and keep going up, while short-sellers panic and cover, causing the price to rise further. The nice thing about momentum stocks is that when they unwind, the drop is fast and furious. I am still holding on to some old Yahoo shorts, and I'm very confident that I'll eventually profit from them. I believe that the Yahoo short-squeeze "climax" occured on Tuesday. I also believe that AOL's "climax" occured today...dampened somewhat by the down market. I also believe that the institutions and market makers that have cornered the stock will unwind positions in December and January. The biggest clue is the open interest, put/call ratios and current premiums for YHOO Dec./Jan. 50s and 55s and AOL Dec./Jan. 80s and 85s. Another red flag was the slew of (dubious) analyst upgrades of AOL coming in the last few days as it flirts with its all-time high. I think any burps up till the end of the year and in January will be caused by nervous short-sellers/day-traders and amateurs who are usually the last to rush in trying to piggyback on the momentum. I am shorting a big chunk of AOL on any upticks friday and significantly increasing my Yahoo short position.

To: Pancho Villa who wrote (8189)	12/11/1997 6:11:00 PM
From: Bill Wexler	Read Replies (1) \| Respond to of 9285

Turbochef is cooking up profits - for the short-sellers! TRBO slid to 8 and change. I'm beginning to think this may also become a "never cover" situation!

To: Pancho Villa who wrote (8189)	12/12/1997 8:56:00 AM
From: Bob Trocchi	Read Replies (1) \| Respond to of 9285

Pancho. saw this article today and cut out a small snippet. In short, the implication is that adv. Rev. on the net is slowing down its rate of growth. If true, and I suspect it is, this will have a negative impact on YAHOO. Shucks, I forgot, nothing has a negative impact on YAHOO <G> Bob T. >>Net ad revenue high, but slowing By Tim Clark December 11, 1997, 6:05 p.m. PT Internet ad revenues for 1997's first nine months topped $500 million, but the rate of increase slowed dramatically as online publishers experienced their first seasonal slowdown in advertising.>> For full article, see: news.com