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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: shane hartman who wrote (56905)	11/6/1998 9:43:00 PM
From: Pat Hughes	Respond to of 61433

He's not predicting 11 billion for ascend. That's its present market cap.

To: shane hartman who wrote (56905)	11/6/1998 9:53:00 PM
From: KM	Read Replies (2) \| Respond to of 61433

Here's a little ditty I came across. Anyone want to comment. FWIW, I think it's bunk. Comes from a site called stockwinner.com Ascend Communications Inc. (ASND) develops, manufactures and sells wide area networking solutions for telecommunications carriers, internet service providers and corporate customers worldwide. Rumors of Lucent Technology (LU) purchase of Ascend have been around the market for more than a year. The rumors persistently have called for a ridiculous premium for shares of Ascend. We are now hearing a rumor of purchase of Ascend by Lucent for $50 a share as early as the next 2 weeks. Ascend has a 52-week trading range of $22 - 55 1/16. It last traded at $44. If you take a look at the Insiders trades, you will note that most of them have sold their shares above $50! (10/23/98) Check the price on 11/5/98

To: shane hartman who wrote (56905)	11/6/1998 10:35:00 PM
From: michael modeme	Read Replies (2) \| Respond to of 61433

The analyst was predicting a buyout of 14.4 billion, or around $69 per share. As a long-term ASND investor, looking out 5 years from now, assuming 35% growth in ASND's earnings and revenues and a corresponding amount of growth in the stock price, one gets around $224 -- or a 348% cummulative gain. If we assume a $69 buyout price from LU, and then around 22% growth from LU/ASND (weighted average of estimated growth rates), we wind up with $186 over the same 5-year period (of course there would be less volatility) which would give us a 272% cummulative gain over today's levels. Since this is my time frame, I hope that ASND doesn't get bought-out (I'll trade long-term huge gains for short-term small gains anytime). If we generalize this and solve for the time frame where there would be equal payoff we get: 2.44 years. So, if you want to hold on to your ASND shares for less than 2.44 years, then the takeover is favorable for you at $69, otherwise it is unfavorable given our assumptions. Cheers