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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: Mr. Pink who wrote (9656)	7/28/1998 8:20:00 PM
From: Saul Feinberg Jr.	Read Replies (2) \| Respond to of 42804

Yes, but the 15 million that Xyplex carried in its books were overstated to begin with. There is no way Xyplex could get rid of it for 15 million dollars. This does not take away from the fact that MRV still got the Xyplex technology, sales people cheap. You are now softening your position. Before you had said the accounting was criminal. And unfortunately, accounting knowledge won't always be enough to invest in high-tech stocks. If you don't know anything about switches, fiber optics components, I'd advise you to avoid being involved with this stock. Go pick on Excite, AOL, COMS, NSCP,CNWK, AMZN, who have very aggressive accounting methods and some of them are trading at lofty valuations. Obsolete, or discontinued product lines by an acquiree, are part of restructuring charges. Unless you are an insider and you go to the warehouse and figure out which products they have assigned as obsolete, there is not a single accountant, armed with a few pages of SEC 10Q filings, who can judge what is going on. On the other hand, you probably don't care what is going on inside. As you are short, you really don't need to uncover the truth. As long as the market perceives the company what you would like it to be, you would have achieved your goal, and perhaps cover your position before it is too late. I am not saying you caused the drop in price. But definitely, I can envision a big group of short-seller's job like this. Go over all the 10-K's filed, look for companies that make acquisitions, take some writeoffs, operating at a negative cash flow statement, and short them. Spread lies about the company's sales people and stuff, and capitalize on people's weaknesses. I don't mean yahoo boards, and SI only. You can use brokers and all that Wall Street stuff and bring the stock price down. While that strategy applied on a basket of stocks, taken as a whole, might work, I think singling MRVC out might be a mistake. This is because, without knowing anything about fiber optics, etc, you can only put a valuation on their technical expertise same as you would on a Cabletron -- zero (the intangibles are not shown on the balance sheet). MRV has said they are aiming to have operationally postive cash flow this coming quarter. If MRV starts having positive cash flow this quarter, the stock price will be up before the quarter ends. It's only a matter of time for the positive cash flow to come (like I said, only a fraction need to pay their accounts payable to MRV and MRV will have positive cash flow). The fact that MRV is not yet 12, after all the negative write-ups (be it H.D. Brous, Infrastracture, etc) says something about the relative strength of this stock. It probably surprised yourself, too, and you kept blaming this on the hype associated with Bay Networks, etc. It may not be a bad idea to cover some of your position. BTW, can u answer about your claims of "sales people leaving"?