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

To: Dan Spillane who wrote (14768)	1/19/1999 11:18:00 PM
From: JP Sullivan	Read Replies (1) \| Respond to of 74651

There may be one more quarter or so of Y2K bubble, OR there may not be. After that, it is all downhill. Which brings us back to the question of why MSFT chose to announce such a spectacular result halfway through fiscal 99 when it really didn't have to. Maybe it's just me, but if I were MSFT, I'd want to keep a little on the side to reduce the effects of the post-Y2K bubble shock. After all, we've got two more quarters to go, and anything can happen -- unless, of course, we're reasonably sure of ourselves going forward. Also, don't forget that MSFT's CFO actually told analysts to raise their figures, if only by a couple of cents. This makes it the second time in a row that MSFT has told analysts that their estimates were a little low. To me that speaks volumes about what the company really believes. Going with your argument that there may be a chance of the Y2K bubble extending into this quarter, MSFT is likely to have a great Q3. After that there is the anticipation of the release of Windows 2000 (yes, I know it's a BIG IF <sigh!>). But in the meantime there'll be Office 2000 and SQL Server 7 to work their way into the sights of many a corporate buyer. Despite all the claims about the imminent Y2K buying freeze or lockdown, I am still undecided as to whether that freeze is really going to happen or if those claims are a mere phantom that people have conjured up in their minds. This belongs on the same page as whether airplanes are going to fall out of the skies at 0000 hrs. Jan 1, 2000 (well, maybe, if they were running Windows 95...) Lastly, why must there be a freeze on IT upgrades just because of Y2K. The premise is that companies are going to put everything on hold while they fix their Y2K problem. Why should this be? More important, how much do these companies that freeze spending contribute to MSFT's revenue? My take is that for the majority of companies, the Y2K problem has either been solved or will not disrupt their operations. (I'm sure someone is going to tell me how wrong I am.) There will come a point where those companies that will not be able to solve their Y2K problems will throw up their hands and say "screw it!" and then go out and upgrade to the latest and greatest, anyway. As for MSFT's price, I think the euphoria will carry over for a day or two, and then there will be profit taking. Down, definitely yes, but not downhill. It's good trading thoughts with you.