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

To: Mike Learner who wrote (9079)	1/28/1998 11:27:00 PM
From: JAG	Read Replies (1) \| Respond to of 14577

bob, Please help me. I do not understand. If you sold 3,000,000 shares short at say $20 and stock is now five and you cover, would not you make a cool $45 million. Why wait until the stock reaches $10 and lose a $15 million of this profit. I suppose one could argue that the note holders are attempting to offset the credit risk of the $100 million in unsecured notes against the possiblity of bankrupcty and the stock being worthless, but I think I would cover at this point and take the $45 million profit. As a matter of fact, I think S3 would jump at the chance to pay the bond holders off at let us say a 70% discount to the face amount of the notes. Bondholders then receive $70 million and cover short and pocket $45 million. Meanwhile they have collected all of their interest. Bob, think about this one again. Something does not add up here.

To: Mike Learner who wrote (9079)	1/28/1998 11:44:00 PM
From: bob yahnke	Respond to of 14577

Mike. Yes. I agree that S3 has taken some positive steps but, I think it's to late in this highly competitive sector. S3 is trying to play the catch up game. I would'nt want to tie up my assets in this troubled company waiting to find out if they will catch up. What S3 needs is to merge with another company. Star stock you say? Check out the Consumer Portfolio thread for details. You will find that I called this one from top to bottom. Short to long. It will easily trade between 15-20 this year. Currently at 10 1/2.