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

To: Margureite deVille who wrote (531)	6/18/1998 9:53:00 AM
From: Trader Dave	Read Replies (1) \| Respond to of 777

It's not me that will give or take away the benefit of the doubt, its institutions, they don't give the benefit of the doubt, especially for dilutive acquisitions. Your math is fairly incorrect, and too favorable to the transaction, but the momentum boys in this stock won't like the defensive tone of this deal one bit. Channel indicates decisions being put off on mcexpress due to confusion, that makes the june quarter at risk which is already back end loaded. I held on to my discreet after the rather strange decision to buy mgi was announced, I regret it (obviously) At least with mgi, there was ZERO product overlap. TD

To: Margureite deVille who wrote (531)	6/18/1998 10:38:00 AM
From: David Kuspa	Respond to of 777

Margureite, Avid crashed in 95 due to earnings warnings stretching out over an indefinite future, delay in migrating to the PCI bus on the Macintosh, inventory problems, management problems, but most importantly, to its flattening growth curve. The stock was grossly overvalued then and it came crashing down. I remember the thrill of Avid announcing quarter after quarter of incredible percentage gains in its sales and revenues. The same thing has been happening over the past year, only without the impressive sales/revenue growth. I never thought this could happen again, but I guess it's a whole new group of investors that weren't burned before. I've been saying "deja vu all over again" for some time now, especially now that Avid is pinning a good chunk of its future on the NT platform and high-end products like Symphony. The transition from the old 68000 chips to PowerPC chips and from the Nubus to PCI bus on the Macintosh was one of the most impressive CPU hardware transitions in the computing world. Apple took a lot of steps to ensure that all software would be backwards compatible between these completely different hardware architectures. But Avid still screwed up big time. Do you really think that developing for a completely different hardware platform AND software operating system is going to be any easier? Among users, the NT version of Media Composer MCXpress is widely known to be vastly inferior to the Macintosh AvidXpress. Avid even changed the name of the Mac version no doubt because the two were not comparable, with the NT version lacking some of the Mac version features. I know some users were complaining that Avid was not being very clear on these important differences and some felt mislead. As further evidence of the difficulty moving from the Mac to the NT platform, Media 100 is also experiencing greater difficulty getting their NT platform up and running. It was originally supposed to be out by this past NAB convention, but is now expected in the fall. And they have announced that they will be pouring the profits of the entire year into this development effort. Now Avid is assimilating yet another competitor's technology and software. It will be a bumpy road, and that is what investors are focusing on. Wait until Avid announces a couple of quarters with both disappointing top line growth and losses due to the acquisition. That PE of 48 just a few weeks ago looked pretty silly then, and even more so now. That is why insiders started selling. Money in Avid will be dead money for some time at best, and possibly a disaster at worst. When earnings go away and there is uncertainty in execution, Avid could easily go back down to the teens again. As always, do your own research, D. Kuspa