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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: Sector Investor who wrote (11738)	1/24/1999 6:53:00 PM
From: Dennis R. Duke	Respond to of 42804

I am out of the stock right now. I think the $8.25 level could be a top until earnings or leaks about how the quarter went start coming out. But for encouragement you should look at the projected 17 cent per share loss forecast for RDRT, and their earnings release this week that beat it by 19 cents, on a reported profit of 2 cents. The analysts may not be closed enough to the Company to know what the right numbers are for MRVC either. Clearly RDRT is a very recent example of 6, as I recall, brokerage analyst being totally wrong about the Company's earning prospects. Don't assume that the analyst know more than you do. Especially since you spent your money to go and visit the Company. Are you sure the Analysts even did a business trip? I'll be buying back in if the market gives me the chance and the cash is available. Keep your heads up, I don't know anything relative to MRVC and its prospects, but give you this as a recent historic prospective. Later, (-8 Dennis 8-)

To: Sector Investor who wrote (11738)	1/24/1999 9:33:00 PM
From: Bruce L	Read Replies (3) \| Respond to of 42804

<Aren't they obligated to preannounce only if their quarter is worse than current estimates?> I strongly believe the answer to this question in no. I tried to do some legal research before I wrote my own little piece, but unless you have access to a legal url like Westlaw etc, the only hits you get on "earnings warnings" etc are innumerable references to same but without any discussion of the underlying legal cites. But here's why I believe its "no." The obligation to keep us shareholders informed is much broader than just quarterly earnings. It's part of the general fiduciary duty that managers have to us shareholders and was developed not from SEC legislation in the l930's but to decades of case law from important corporate states like Delaware and New York: cases that found it to be a breach of that duty for management to pass information on to friends and cronies relating to new developments, new discoveries, new contracts etc., before that information became generally available to the public. Second, the fiduciary duties are personal to the management and cannot be informally "delegated" to outside analysts etc. After all, until recently the general public did not have access to private analyst's reports; and often still don't. It is management that carries the duty; once they determine the information is "material" they have only a reasonable period of time to make it public; or they are personally liable to us shareholders. Like you (I think), I am sceptical of a loss for Q4.(Apart from a further ramp up in SGA and R&D.) For a company as diversified as MRVC, things such as revenue and even earnings are like an oil tanker: it takes a long time to turn them around. Also, all those new high dollar salespeople just hired must be doing something for their money! FWIW, I was not impressed with ROKTOR's analysis. As you know, he suggests that management may be directly or indirectly transferring new potential products and ideas to independent entities leaving MRVC with low value commodity items. First, I don't believe it's feasible to do something like that without creating a trail of evidence leading right back to the perpetrators. Second, even if they did, they would possess new smaller entities that would still face the problem that ROKTOR correctly identifies, to wit, to develop the credibility of a small entity to deliver to the marketplace blockbuster products. Finally, despite their ineptitude in other areas, I DO trust management in the moral sense. Bruce