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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Druss who wrote (2299)	2/5/1998 6:51:00 PM
From: Lazlo Pierce	Respond to of 18691

Well, per my post yesterday, I picked a decent time to get indignant about the price gains of MU. Its not too often an analyst hands out an "Avoid" rating:-) Shorted @ 38 today. ******************** from briefing.com <<MICRON TECHNOLOGY INC. (MU) 35 5/16 -2 11/16. After more than a month of consistent up moves in the shares of this maker of DRAM chips, the stock has hit a rough patch today as the Brown Brother Harriman lowered its view on the stock. Since early January, the stock has appreciated by more than 40%, helped in part by various brokerage house upgrades, including a positive view from Abbey Joseph Cohen of Goldman Sachs. Given that the stock is heavily shorted, price gains have also come at the expense of shorts who have had to cover when the stock has been unwilling to fall. Despite the upward stock movements, however, this has not been enough to change the view of influential analyst Thomas Kurlak of Merrill Lynch. He has continued to pooh-pooh the stock, looking instead for the stock to drop to $20 on the view that DRAM prices would likely remain too low to drive earnings. Today, the stock ran into increased selling as Bill Milton of Brown Brother Harriman took a similar stance to that of Mr. Kurlak and cut his rating on the stock to a short-term "avoid" from "neutral," while maintaining his longer-term rating at "market perform." Mr. Milton's views on the stock are similar to those held by Mr. Kurlak, stating that Micron "continues to lose money in the memory chip market, despite recent upswings in prices for the 16-megabit dynamic random access memory, or DRAM, chips." DRAM chips are said to be selling at around $3.50 each, below MU's manufacturing cost. Thus, while short-sellers have been waiting for a break in the stock to recover recent losses, it will be interesting to see how the stock behaves in future sessions and whether other Wall Street firms start to change their views, if only because the stock has had a very nice run in the past six weeks. Dave