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

To: Highway Jim who wrote (59244)	1/16/1999 9:26:00 AM
From: Howard Feinstein	Respond to of 61433

JBB, I would say $89-$90 is close to the max price. Howie

To: Highway Jim who wrote (59244)	1/16/1999 9:35:00 AM
From: Jack Colton	Read Replies (1) \| Respond to of 61433

Everyone I know who is Holding LU is very pleased. Continuous strong growth. The "Max Price" won't happen... At least as long as LU is one of wallstreet's darlings... It will just continue to grow. I think we will average $2.50 per day growth up to $100 if not beyond. Message 7266300 jc

To: Highway Jim who wrote (59244)	1/16/1999 10:37:00 AM
From: William F. Wager, Jr.	Respond to of 61433

JBB<<max price>> LU hopes to close the deal in May. I am watching the price of LU since ASND holders will get 0.825 shares of LU when the merger is complete. So, in a perfect world, if LU goes to 130 by May.. you do the math. In other words, at this point, it is virtually im- possible to predict the "max price." On the other hand, if LU goes to 70 at merger time, you see the problem.

To: Highway Jim who wrote (59244)	1/16/1999 2:15:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 61433

JBB there are a number of things to consider. First, if you sell you will trigger capital gains taxes. Because the merger is a pooling of interests there will be no tax trigger unless you sell. [Incidentally, that's one of the best reasons to adopt a buy and hold strategy. Suppose you own a security growing at 30% per annum. If you are a trader, your after tax yield will be 30%(1-0.28) or 21.6%. But if you are a buy and holder, and hold for say 5 years your after-tax yield is 26.4%. In order for the trade to match that return he would need to do a little better than 33.8% just to equal what you did for 30%. The differential gets bigger when you consider quarterly taxes and transaction costs' Second, there is merger discount of $4.77 included in the price of ASND (86 3/16) compared to LU (110 1/4). This gap will narrow over the next four or five months. So, if LU grows at approximately the expected growth rate for the company (ignoring issues like the general tone of the market and whether the market sees major synergies in the acquisition, or potential dilution of LU shares by further acquisition), five months from now LU would be expected to trade for $121.80, and ASND would be $100.48. That works out to a 16.6% increase over 5 months, or a little around 44.6% per annum annualized. So for this reason alone I would opt to hold. Finally, there is the question of synergies. If the street perceives the marriage as positive LU will appreciate at a faster clip than indicated above. Hope this helps. In case you haven't figured it out yet, I'm holding at least until the deal is finalized <VBG>. TTFN, CTC