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Technology Stocks : International Rectifier (IRF) -- Ignore unavailable to you. Want to Upgrade?

To: voodooist who wrote (955)	4/8/1998 12:25:00 AM
From: DanZ	Read Replies (1) \| Respond to of 1712

Fred, I'm more knowledgeable about IRF from a technical perspective than a fundamental perspective, and although it seems reasonable that Vishay might be interested in buying them, I wouldn't buy this or any other stock based on a takeover possibility. IRF is relatively inexpensive right now based on several fundamental measurements including price to sales (1.1), price to book (1.5), and price to earnings ratio divided by its expected growth rate (0.8). While these things increase the likelihood that somebody might be interested in acquiring the company, I still wouldn't buy the stock based on that. The short term technical picture for IRF doesn't look all that great right now and I think there is a good possibility that it will test it's weekly support near 10 1/2. I haven't sold any of my stock and I'm planning to buy more if it declines to the weekly support and it still looks ok to me. The stock broke below the lower daily bollinger band today and also had poor money flow for the second day in a row. The daily stochastic turned down as well today. I don't see any reason to sell the stock because it doesn't look like it has that much more downside risk and there's no guarantee that it will decline to 10 1/2. However, I don't think anybody should be surprised if it gets to 10 1/2. The only positive action that I have seen in the past two days is that it held support yesterday even though the money flow was very bad. This tells me that there are substantial buyers in the 11 5/8 area but there are just more sellers than the buyers at the moment. The semiconductor stocks in general are under pressure right now but I feel like they are putting in longer term bottoms and I'm willing to ride out the storm. I believe that IRF has significantly more upside potential than the downside risk even if it declines to 10 1/2 and I'm not selling my stock. Dan