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Technology Stocks : PSFT - Fiscal 1998 - Discussion for the next year -- Ignore unavailable to you. Want to Upgrade?

To: Trader Dave who wrote (3536)	11/16/1998 6:03:00 PM
From: L.B.Nguyen	Respond to of 4509

What kind of P/E multiple can we expect from this new company ? I can see PSFT game plan now. Once a week, the new company will announce a new partnership with a major company. MMs will drive this stock through the roof. Gooooooo PSFT AT&T spinned off LU a while back and it is still benefitting from it because LU is being considered a higher/faster growth company than its parent.

To: Trader Dave who wrote (3536)	11/16/1998 6:04:00 PM
From: Grabs	Read Replies (1) \| Respond to of 4509

I don't think its a trick, more like a tracking stock. Companies like GM have used tracking when it owned EDS(GME) and Hughes (GMH) to account for the separate operations. Also Sprint is now about to issue a stock to track its PCS subsidiary. So it's not that uncommon. Most importantly is whether this initiative will truly accelerate the proliferation of add on applications as well as PSFT's entry into other vertical markets. It seems like a stand-alone R&D shop. Perhaps an avenue for JV's (maybe with Hyperion?) Another issue which I just noticed while rereading the release is that this is a taxable event for shareholders. IMO, this could spur more end of year tax loss selling depending on when the distribution becomes effective. Anyways, I remain long term bullish on PSFT. -Grabs

To: Trader Dave who wrote (3536)	11/16/1998 11:35:00 PM
From: Melissa McAuliffe	Read Replies (3) \| Respond to of 4509

I really don't understand this. If PSFT funds this with $300M of their cash then it seems like this will be a wholly owned subsidiary of PSFT. Or maybe not. I just don't know. But if that's the case then what's the point of this. They're still going to spend the same amount of money on R&D and then PSFT has the rights to the products. So why spin it off as a separate company? It seems like it's still PSFT. I'm hoping you can explain this because I think I'm missing something.