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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: soup who wrote (11253)	4/14/1998 10:21:00 PM
From: George von Dassow	Read Replies (1) \| Respond to of 213173

No, it means that an unprecendented* number of short-term players betting big-time, that AAPL will bolt upwards as a result of tomorrow's earning announcements.* Someone please correct me if I'm wrong (I mean that), but it is my understanding that the exact opposite is the case. Someone(s) wrote all those calls, sold them to us, and presumably would not have done so if they anticipated a big run-up in the price. Thus, it is my understanding that the large open interest indicates, rather, a short-term pessimistic sentiment. Further, is it not reasonable that a significant fraction of this interest represents people who held during the run to 27-28 writing covered calls, again in expectation that they would not be assigned? Don't get me wrong, I'm neck deep in April 25s. I am also fully aware there are more reasons people or entities write calls than the above, but those seem pretty likely with all the wondering about whether AAPL has peaked, or is fair valued, or will post a nice profit, or whatnot. Again, I'm no expert on options mechanics, so if I'm mistaken I beg correction from someone who knows more. - George

To: soup who wrote (11253)	4/14/1998 10:47:00 PM
From: Marc Newman	Read Replies (1) \| Respond to of 213173

Soup, congrats on the nice options purchase. My thinking is along the lines of George, though I know less than he does about options. There is a conspiracy of interests at options expiration time that often leads to a close near the point of maximum pain. I assume that with so many calls that the stock may well close below those strike points. I'm sure Phil would like to add something here. Anybody else can jump in too. Rhet, I think you misread my comment as being about Office '98 for the Mac. It was about Windows '98, the pc OS. The upgrade is over three times what Apple charges and the stand alone is two times. But wasn't Windows 95 about $100, from inception? It seems that either the monopoly is starting to invade the pricing of the OS or else Microsoft knows that not many will be sold compared to '95 and needs to recoup engineering expenses. I assume that the OEM cost must stick close to what they get for '95, otherwise it could be embarrassing if the major customers opted to go with '95 over '98. Linda, I think you are suffering from a bizarre accident somewhere along the line and hope it all works out. As for the education space, I don't think Apple will be winning back market share this year, just hanging in there. And if schools are as flush as the Fortune article indicated, then Apple might even see sales grow. (Kind of like how Novell is supposed to see NOS sales grow slightly despite losing market share to NT.) Alomex, I don't think there's anything wrong with holding off your buy recommendation until a second quarter of profitability--we must avoid the Amelio one-shot factor. Also, someone on the Dell thread had access to an European pc report and it showed that Apple had stuffed the channel there last quarter, though not as much as IBM and Compaq. So maybe last quarter's numbers were a little worse than we think and this quarter will come in at $1.4 billion revenue after all. The call buyers would get minor burns, and then Apple can resume the upward path next week with clearing skies forecast for the next nine months. In Apple's defense, the channel was ridiculously stuffed for Christmas 1996. Apple counted $200 million in Performa sales for that Q but actually sold them in the March quarter. So revenue a year ago was really $1.8 billion and only slightly down from Christmas. So Apple has been essentially cash flow positive from ops for a year now, something most shorts on this board don't realize. Eric, your last post is the icing on the cake. I declare you board MVP for the quarter. You had stiff competition, but you have done a great job and I appreciate it. Marc Edit--Bill, wrong again: <<but you never hear of the outbursts of vituperation that Jobs is famous for.>> Gates is well known for it too.

To: soup who wrote (11253)	4/14/1998 11:20:00 PM
From: Sam Scrutchins	Respond to of 213173

No, it means that a large number of short-term players betting big-time, that AAPL will bolt upwards as a result of tomorrow's earning announcements. Assuming a great earnings report: Some percentage of these players are long-term investors who bought the options as leaps. They may cash in for their long-term gain, or exercise the options to hold out for greater gains. Perhaps the increase in value of the options provided them enough capital to purchase some number of shares not otherwise possible when the options were purchased. Sellers of options may panic as the underlying price of the security skyrockets--like a short squeeze, except in the options market. This would put a great premium on the options two days prior to expiration. Thursday will be a great day for the longs!! Sam