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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Kenith Lee who wrote (30964)	4/3/1998 6:09:00 PM
From: AK2004	Respond to of 1572208

Kenith I think that the real problem with some intel investors is that they do not appreciate the risk rather than anything else. Intel stock viewd as risk-free (just like t-bonds) and yet demands higher return. If investors would not sell then it would actually drive the price up due to the fact that demand for stocks would be higher than supply. That what probably keeps intel going this year. Remember that the number of shares doubled due to split. The current shares are valued the same as a year ago pre-split. Revenue per share is down by 30-40%. Expected earnings per share are down vene more because expenses are up and margins are down. To top it all the short term growth rate is 0 and the long term growth rate is also down. Given above any reasonable person would think that the stock price should go down from previos year. Yet it is the same (no split adjustment). But by the same virtue if something bad would happened to Intel then sell-off is likely to drive itbelow the "fair value" (whatever it is) Drop in prices would trigger margin calls, margin calls would increase supply and the chain reaction is on. The tax effect while is there does not really prevent selling the stock. One can also short the stock while staying long. Regards -Albert