Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Mario who wrote (3663)	11/20/1998 10:53:00 PM
From: Ed Stern	Respond to of 4509

No way, Mario - what you say makes perfect sense. I think it'll be awhile before it moves (6-9 months or so), but they'll move like ORCL did after they were hit. I held on then and I'm glad I did !! Luck to all ! Ed

To: Mario who wrote (3663)	11/21/1998 9:28:00 AM
From: Richard Tsang	Respond to of 4509

Mario, what you said makes very good sense to me! I am okay with the way PSFT handles the repricing. Although, as a shareholder, I do not like company repricing employee stock options, they did the right thing at the right time, I think. They set a minimum strike price of 22 which is probably the price they were looking at when they worked on the repricing proposal to the BOD. The new option price will not be lower than 22 or the market price on Dec 12, from what I read. That is fair. Only comment is they should exclude the top 4 excutives, in addition to the CEO - the policy makers should not make it self-benefiting. I think the objective of this repricing is not to steal from the shareholders, but to add value to them by finding a way to keep the talents and increase competitive edge. This market has evolved to this stage, not because of management. It is the change in market conditions. The two initiatives are excellent strategies IMO and will pay off in the long run, though not so welcome by the shareholders. I also give a lot of credit to the management's foresight in keeping a lot of cash for rainy days, instead of using them to buy shares back, which I think is very short-term oriented approach to please shareholders,(like DELL). I think there will be more consolidations going forward in the market and the cash that MBA has is well suited for more acquisition and merger with new emerging technologies to strengthen new product stream. Look at BEAS, which is a "middleware" play. They delivered in the last Q, within expectations, but because the management wanted to guide analysts to lower expectation, their share price was slashed by half in one day. A good entry point if you are bottom-fishing IMO, and a good candidate for Momentum to look at. The acquisition and merger writeoffs will not be reflected in PSFT books. Instead, it will be "hidden" in MBA's. This business model of PSFT/MBA is a great way to enhance shareholder value. PSFT continues to make money while MBA continues to invest, both will attract investors with different investment appetite - a growth stock in PSFT and a long term investment for MBA. You can look at MBA as one of the "e.com" plays that has yet to turn in profit but has huge potential in the future. That is exactly what management said in their PR - allow choices for investment. There is no U-turn on employee stock option practice. This is spreading in international quickly as well. The "carrot" contributed to great successes of many companies including (CSCO,MSFT,INTC,DELL) and created so much wealth for shareholders (as well as employees and Corporate America) that the Japanese and Germans are following now. These countries are making the laws easier for their corporations to offer stock options to employees to compete in the world market. There was a lot of restrictions in the past in these countries. I doubt the US will go the opposite direction. The cost of my holdings in PSFT is 19.50 (bought two times) and I am looking for a 100% return in the next 12 months. RT