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To: Andrew Vance who wrote (12349)	2/24/1998 3:09:00 PM
From: Trader X	Respond to of 17305

<CYMI-...might even get close to Kevin's desired entry point.> eighteen, eighteen, eighteen eighteen and I LIKE IT. -Alice Cooper Might?! Oh ye of little brainwashing, I think I need to re-apply the chinese water torture yet again...a constant drip of past posts...to reaffirm thine allegience to the Technical faith. -kh

To: Andrew Vance who wrote (12349)	2/24/1998 4:24:00 PM
From: Andrew Vance	Respond to of 17305

AV--Whatta play, BYDSQ is down for the day. Just a few more steenths and we go back into it for another jump over the lit candle. AV

To: Andrew Vance who wrote (12349)	2/24/1998 5:47:00 PM
From: Andrew Vance	Read Replies (2) \| Respond to of 17305

AV--IPEC Warning. After the close of the market today, a story came across the wires suggesting that the high volume and price action of IPEC today was, in part, due to takeover speculation by LRCX. Both companies would neither deny or confirm the rumor. The story said the rumor started on a Stock Rumor website and has spread enough to attract some speculators. While we might even be the Stock Rumor website<GGG> or the rumor will be reality, is not the issue right now. What is important is that IPEC has gotten some visibility and can be affected in either direction. In other words, we might get some action on "herd mentality" for better or worse. To the heart of the rumor, LRCX and IPEC. This is actually a very good fit and does make sense. IPEC uses the LRCX(ONTK) backend cleaning station for their complete CMP tool suite. There is a nice cooperative effort between the two. A merger is in there best interests if they want to bring the AMAT competition up an notch. This could be a win win situation for both, especially going forward into the upcoming 300mm technology shift. This could help oddset the troubles LRCX has relative to marketshare, upcoming revenues and earnings, along with the Asian Crisis. The bad news is that we already know how bad things are at LRCX and an acquisition at this time does not make good business sense. They are in the midst of laying off people, shutting down facilities, getting out of some businesses, and cutting back on certain R&D functions. The timing is real bad for something like this and Jim Bagley is too smart to attempt this at this time. Furthermore, something like this would be more appropriately orchestrated closer to the July Semicon West timeframe. So if indeed there is any truth to these rumors, I would think it would be closer to July than now, especially with the quarterly earnings and the forward looking uncertainties. Bad business to do it now. It would be a great deal for the IPEC shareholders if a stock swap occurred but it would be of greater shareholder value to allow IPEC to finally capitalize on the CMP marketplace as it takes off in the next 2-5 quarters, big time. Again, poor timing. With all this said, you all know the expresion, "where there's smoke, there's fire." Let's not get burned and let's not get suckered on this. And if it is true, let's make sure we don't do anything foolish that we will regret. Bottom line: IPEC may be in play so we need to tread slowly and cautiously and respond as events unfold, no matter what they may be. Let's be careful out there since IPEC was at $14 not too long ago. Andrew

To: Andrew Vance who wrote (12349)	2/24/1998 11:54:00 PM
From: Mark Adams	Read Replies (1) \| Respond to of 17305

re: ADPT - they made negative comments during the conference call following the acquistion announcement. Something about revenues off this quarter. Edit: Here's the article- it was in the San Jose Mercury: Posted at 8:07 p.m. PST Sunday, February 22, 1998 Post-deal tidbits take a sizable bite out of Adaptec's stock price Feb. 23, 1998 BY ADAM LASHINSKY Mercury News Staff Writer SAVVY investors agree that reading the fine print is crucial. Even more important -- but less feasible for the investing masses -- is listening to the conference call with analysts, which is where the real action happens. The difference between the written and spoken word goes a long way toward explaining why the stock of Adaptec Inc. (Nasdaq, ADPT) plunged Friday, although the company had unveiled a blockbuster acquisition Thursday at a ''fire sale'' price. Investors read in news reports and Adaptec's news release that the Milpitas-based company is picking up Symbios Inc. from its distressed South Korean owner, Hyundai Electronics America, for a relative song: $765 million in cash plus $10 million assumed liabilities. That's comparatively puny because a ''multiple'' of about 1.2 times Symbios' $620 million in current-year sales is small for acquiring a high-tech company. And Symbios will add immediately to Adaptec's earnings. All true, but snippets from the post-announcement conference call and other tidbits explain why Adaptec's stock fell 9 percent to $23.31 Friday in heavier-than-usual trading. In the call, Chief Financial Officer Paul G. Hansen dropped a bomblet unrelated to the acquisition. He alerted analysts that revenues from the company's semiconductor business would be about $10 million less than previously expected. And the company's earlier guess was $10 million below the product line's revenue for the fiscal third quarter ended Dec. 31. The maker of adapter cards that connect PCs and disk drives had hoped gains in its main product line would offset declines in the chip business. Hansen said Thursday such a scenario ''is going to be increasingly difficult.'' Moreover, the company revealed that while its price for Fort Collins, Colo.-based Symbios is reasonable, Hyundai paid somewhat more than $400 million for the company three years ago. Adaptec should know; it bid for Symbios then. Hyundai invested heavily in the semiconductor maker, whose profit margins generally are lower than Adaptec's, but it's still offloading the unit for nearly double what it paid. Finally, not mentioned but obvious to anyone whose memory extends one month, Adaptec said Jan. 20 it would repurchase up to 10 million of its own shares on the open market. That's a typical response from a company whose stock has been hammered. Investors generally like buybacks because when companies reduce the supply of shares, stock prices tend to rise. Adaptec's stock dropped from more than $50 as efforts by PC makers to reduce inventories have slowed component purchases. The Symbios acquisition, which will soak up all of the company's $728 million in cash and force it to borrow more, nixes the buyback program. Says Hansen: ''When we found out we had this great opportunity to buy this excellent company for 1.2 times sales, that took priority over all our resources.'' One analyst, Scott Randall of SoundView Financial Group Inc. in Stamford, Conn., cut his recommendation from ''buy'' to ''hold.'' Another, John Lazlo of Paine Webber in New York, shaved three cents from his earnings-per-share estimates for Adaptec's current quarter. Incidentally, while investors with the time and energy can pore over securities filings, they often can't listen to conference calls. An Adaptec spokesman says the company's teleconferences are ''directed at institutional investors.'' That's understandable up to a point, considering the costs to the company. But it's yet one more example of how deep-pocketed investors have a big advantage over small fries. BREAKING UP IS HARD TO DO: It's been a five-year-plus relationship, but Deutsche Morgan Grenfell Inc. computer analyst Michael Kwatinetz has ditched Compaq Computer Corp. (NYSE, CPQ). He recently removed his ''buy'' recommendation and instead rates Compaq an ''accumulate.'' ''Compaq has been very, very good to me,'' Kwatinetz writes in an angst-ridden note to clients, noting that the Texas-based computer maker's stock has appreciated roughly 18-fold since he first began pushing it in late 1992 and never wavered. Kwatinetz explains the downgrade mostly by the risks associated with Compaq's acquisition of Digital Equipment Corp. (NYSE, DEC), which is expected to close later in the year. ''Its strategy appears sound, but execution risks are high,'' he says. Compaq, however, still has its fans. One is Richard S. Chu, an analyst with Cowen & Co. in Boston. ''I'm a strong believer that brand and logistics will drive consolidation'' in the computer industry, Chu says. ''I think people underestimate what Digital brings to the party.'' Chu also says Compaq management will be a party pooper by taking an ax to Digital's workforce. He reckons the company can cut 7,000 of Digital's 53,000 employees and save $500 million in the process. That alone could boost his estimates of Compaq's 1999 earnings by 11 percent. Says Chu, who rates Compaq a ''strong buy'': ''They should have plenty of opportunities to cut costs.'' Cold to be sure. But if Chu's guess on Compaq's tough love is right, Kwatinetz may wish he never walked out on his longtime dance partner. -- This accounted for the drop following the merger announcement, as it was explained in the article.