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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: johnd who wrote (14515)	1/18/1999 6:57:00 PM
From: 16yearcycle	Read Replies (1) \| Respond to of 74651

I think your concerns are valid, and the q and outlook will tell the tale. Normally I would give you an 80% chance of being right, but I think the q could be huge and they could be seeing a strong q3 already. As I said, I will sell some in the am on a run up despite my bullishness on MSFT's business outlook. When the fed is clearly in a non-easing mode again, say in the late summer or fall as Asia looks better and Brazil is stable, I expect big trouble. The fed will try to deflate what they inflated. We should have some good buying opportunities at that time. I just think the fed will have to stay easy right now. Internet mania will continue to weaken. I expect AG to rattle his saber a bit, but to keep the pump primed.

To: johnd who wrote (14515)	1/18/1999 8:24:00 PM
From: t2	Respond to of 74651

Johnd, I understand your point of why MSFT will try to talk its stock down at earnings. Last year at this time, the stock had declined from about 150 in July 97 to about by Jan 98 earnings release. I guess the employees were probably not that happy with their stock options which were issued on July 1/97. So MSFT announced a split which resulted in the huge stock move. This time the stock is actually up quite a bit since July 98 and there is less of a reason for MSFT to try to push stock up. However, given that investors are learning about MSFT policy with respect to its stock price, it will be harder to fool them. My feeling is the stock will trade at what the company is worth not what the executives want it to trade at. WHY? Because investors now have a better understanding of MSFT policy of understating true revenue and thus EPS. If the company does not report more than 61 cents, look for a big jump up in the unearned revenue account (and investors know about this also). They also know about the standard cautionary statement which has not only fooled investors but also "smart" ANALYSTS who had downgraded the stock after hearing such nonsense. Furthermore, NO REPUTABLE ANALYST WILL DOWNGRADE THIS STOCK ON WEDNESDAY. The only possibilities are no change or upgrade (and possibly an increase in price target. Now what will that do the price! YOU GOT IT -- UP UP AND AWAY!!! JMHO.

To: johnd who wrote (14515)	1/18/1999 9:52:00 PM
From: J. P.	Read Replies (1) \| Respond to of 74651

JohnD, thanks for your opinions, how about a counterpoint?... You've made some valid words of caution here. I'm worried also, but I'm not going to sell tomorrow, because I think MSFT will continue to power for a week or two. For long term holders, this is a non issue, I speak as a February option contract holder. My reasoning is that the Nasdaq and the general market made a key reversal on Friday. The closing broke a downtrend and with a positive market tomorrow, we'll be in an uptrend again. Intel, Yahoo, and AAPL got knocked down, I believe, because they had the misfortune to announce during the Brazilian uncertainty. I've been stating for a while now that the Nasdaq looks ripe for a downside consolidation, I think back to 1800-2000 level, but not just yet. I think any continued overbought top buying on the Nasdaq is going to bring Microsoft up with the tide, particularly with a good blowout number, and a typical to positive conference call. Nobody worries about cautious Microsoft statements, I think it's expected. I put the possibility of a split also very very low, am not expecting it at all. If they do announce one, I believe 165-170 would be my sell target.

To: johnd who wrote (14515)	1/19/1999 12:07:00 AM
From: Catcher	Read Replies (1) \| Respond to of 74651

johnd, this time around doesn't msft's pe look just as good relative to pe's for other companies--they have risen too. in other words, which other stocks make more sense--or are you saying cash is better option

To: johnd who wrote (14515)	1/19/1999 12:28:00 AM
From: Daiju Kohno	Read Replies (1) \| Respond to of 74651

Johnd, You have obviously done your research on MSFT, but I can't resist pointing out your reliance on PE. If you saw WSW on Friday, Gail Dudack (a bear since '96) mentioned that she overheard someone say that PE is no longer a useful stock-picking tool. Her reply was that if PE's were no longer useful, then the stock market is a casino! This was perhaps the silliest thing I've heard a "professional" say on TV. She (like many analysts and fund managers) relies so heavily on PE that without PE, they feel helpless and clueless. The fact is, the PE ratio is over-rated. (MSFT's PE was considered too high when the stock was at 23 cents!) Maybe that's why so many professionals fail to beat the market- because most of them rely so much on the PE ratio. Nevertheless, thank you for your posts. I find them refreshing and educational. Respectfully, DK