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Technology Stocks : Applied Magnetics Corp -- Ignore unavailable to you. Want to Upgrade?

To: Jonathan Bird who wrote (11298)	1/22/1998 3:04:00 AM
From: Don Earl	Respond to of 12298

Hi Jon, It's looks like a suckers rally to me. Stochastics are at over 80% and there is no support under it at all. Not that that will mean anything. This has got to be the worst stock I've ever played. The damn thing even leaves gaps in the friggin 1 minute charts!!!! I hung on as long as I did because with the numbers available at the time there was no way the company could go broke. With the information currently available APM will be out of cash, with the exception of about $50 million that is callable on demand, in about 6 months, at which time book value will be at about $4 per share. Maybe the over capacity problem will be cured by then and they will have design in status on several MR programs. It seems more likely that the bigger players will keep up the pressure until the smaller competitors are forced out of business. I think it's interesting that IBM didn't seem to take a hit from this part of their business. It seems probable to me that IBM will sit back and watch the blood bath while they quietly continue making drives for their own products. IBM is at the top of the technology food chain. They have produced experimental drives with densities orders of magnitude beyond anything being currently produced. Just about the time a couple of companies are left standing, IBM can step into the battle tanned, rested and ready, and stomp them flat. There's still plenty of bad news yet to come. Does anyone think WDC is going to make the break even quarter they predicted in early December? Or that they won't cancel anymore orders for TFI heads? How long can Dell, Compaq and IBM pump out record levels of sub 1K PCs before they run out of buyers? APM was a screaming steal right up until they released the numbers and forward looking statements for Q1. The current consensus estimate of -$3.71 for FY98 strikes me as being extremely optimistic. Regards, Don