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Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Judy who wrote (7742)	4/22/1998 9:21:00 PM
From: Robert Graham	Respond to of 42787

Aha! Finally made it back on the Internet! Here is my first post I had ready for you. This comparing of notes is very worthwhile to me. Thank you for the recommendation of earthlink. I have tried Mindspring, Sprintnet, Primenet, Starnet, and IBM Connect, along with seeing a freind's past experience with AOL. The $19.95 flat rate appears to be facilitating the creation of unmanageable or not very well managed networks. In an attempt to deal with costs, some ISPs use 100% PCs with a UNIX OS in the public domain. When e-mail delivery becomes unreliable, it is time for me to move on. I have not looked that closely today, but from what I have seen, I want to restate that I do not see the quality buying with IBM. In the morning after the announcement, I definitely saw fund selling with IBM. So far from what I can see, I think the "smart" money is selling into the strength of IBMs current uptrend which leaves for the most part the speculative public reponsible for current price action. But I agree that what I am seeing here is one "data point" which does not make for a more filled-in picture in the form of a trend. CPQ is where I see very good quality buying. Also, near the end of the day, CPQ saw a few 500,000 share purchases. Question: So your expections were that the public would not see the decreasing revenue and earnings growth in this industry as evidenced by the earnings report from IBM? Question: Can you tell me your thinking behind looking for "data points" to trends after program buys and sells? I did see HWP as under accumulation, but I saw none of the very large block purchasers step up to the plate for that stock like they have for CPQ. Most large blocks for HWP were about 50K instead of the frequent and agressively placed orders of 100K to 200K blocks in the case of CPQ. But on careful rethinking of this statement of mine, if I look at it in terms of total money outlay, the large block market values are comparable between HWP and CPQ with CPQ seeing many more of them which are more agressively placed. Also from this perspective, this means that comparatively large amounts of fund money left IBM. As far as the announcement of microprocessor growth from Intel, I am surprised it has generated this interest in the box makers, particularly considering the earnings downgrades experienced by Intel and the prospects of a continued smaller earnings and revenue growth that is in evidence for this company. Couple this with other key high techs reporting reduced revenue and earnings and you have a pattern that needs to be looked at. But then the funds are looking for some kind of value in this very overvalued market. When not knowing what to do, people tend to go back to what they are familliar with. CPQ took a hit due to their DEC aquasition and has brought the stock down to an attractive price based on their past experiences with the stock. They disregard that Compaq may now be a different company due to their recent large aquasitions that needs to be managed differently and have different kind of investor expectation placed on the company's results. But the past guides their thinking. Still, Intel is further down the food chain compared to companies like CPQ and DELL which will be the first to benefit from any increase in sales. All of this together indicates to me a very positive market sentiment by the big money along with a more "exuberant" positive sentiment by the speculative public. Working together, we should continue to see some interesting results in this market. This is like gun powder that has been thrown up in large quantities in the dry atmosphere of a barn. We may see that sentiment induced blowoff to this market yet which the unprecendented market liquidity has helped set the stage for. Even the turnaround IFMX (that still has a long way to turn around) is seeing some action before earnings announcement by the "nickle and dime" public speculators that trade the out-of-the-money options on earnings plays. I felt generous and sold some covered CALLs to them. I will look at DELL today when I can get a connection to the quote server to work. Bob Graham