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

To: Uncle Frank who wrote (15605)	2/6/1999 10:33:00 PM
From: Lee Martin	Respond to of 74651

Right on Frank! Can you imagine what the IPO of MSN would be like? The market values MSFT as a software co. with no recognition of the the internet side of the business. One reason I'm in the stock is I think the market will begin to recognize the value of MSFT's investments in the internet and award it a higher PE and stock price. Of couse with a mandated split that value would be recognized overnight. Let's assume the court orders MSFT to spin off IE, MSN etc. what would be the smartest way to play these IPO's? Why to buy MSFT, preferably BEFORE the gov't orders the split. So in other words I like MSFT in one piece but if the gov't wants to force it too split up that would be even better. Hopefully all the hype about what the gov't might do will cause an analyst to run the numbers and figure out what the pieces would be worth. As soon as that info. hits the wires MSFT is headed higher. Regards,Lee

To: Uncle Frank who wrote (15605)	2/6/1999 11:07:00 PM
From: RTev	Read Replies (1) \| Respond to of 74651

I agree with t2 that a divestiture is highly unlikely and that if any divestiture should ever occur, it would be only with management consent. But like Sailor, I look at the two most famous divestitures -- Standard Oil and the Bell System -- and I kinda drool (and I sure wouldn't short the stock unless I was in a short-term guessing mood). But that's also why I think an MS divestiture, while unlikely, is still possible much sooner than t2's "5 to 10 years from now". Microsoft has a small and tight-knit board that owns much (30%) of the company's stock. Gates, Allen, and Shirley benefit greatly from the ever-increasing price, and do all that they can to assure continued appreciation. Although it would be a wrenching decision, I I like to believe that the board would look for ways to split the company if they were convinced it was in the best long-term interest of shareholders. Look at the history of Ma Bell. They battled anti-trust cases for half a century. The government kept trying to get them to at least give up Western Electric and they kept fighting it off by accepting ever-more-onerous regulations. Finally though, AT&T itself crafted a divestiture plan that shocked just about everyone: The Ma company itself would keep Western Electric and give up the "Bell System" (oh, and they'd also keep the Long Lines division that everyone in the biz press figured would be dead in the water within a few years). With that, they settled a series of lawsuits with a consent decree. AT&T's board was right when they reasoned that shareholders would benefit. They've benefited handsomely indeed. I wonder if the shock of a loss in Jackson's court might not prompt the MS board to take a hard look at ways to stop the legal wrangling once and for all. I'm convinced MS shareholders could benefit handsomely from a carefully-crafted divestiture. One example: Instead of draining the company's bottom line with its multi-millions in losses, the online operations of msn.com sites could be enjoying the equity bubble of today's internet stocks. One might not want to hold it for long, but it sure would be nice to enjoy the ride up. Sorry for the long post, but since I brought it up... Maybe this is worth a string in the CoffeeShop area, eh?