To: Gary who wrote (5744 ) 4/19/1999 11:50:00 PM From: Scott Kessler Read Replies (1) | Respond to
I own both MSFT & EMC. On Fri. & Mon. I loaded up on some May 115 calls. My exposure's pretty significant (for me) & every time I think the stock's oversold, it goes down. $99 or so is the resistance level, so if the stock breaks that & closes under that -- we're gonna have some technical probs. short-term. Nonetheless, EMC's a screaming buy right now. The co.'s dominant, mgmt.'s supberb & focused, the technology is way ahead of the competition & the stock's down 25%+ from its highs. Right now we're looking @ a fwd. p/e of about 40. For a tech bellweather, a gorilla -- the peg ratio's pretty damn attractive. The main prob. over the past wk. is that the stock was being sold en masse by institutions (incl. largest holder Fidelity). It's amazing what 1 little known analyst on the west coast can do w/ a downgrade attributable to his belief of Q4 uncertainty ($0.08!). The co. came out & disputed his claims w/ more detailed info of their own & from others. I've been surprised that other analysts haven't pounded the table on EMC. The only 1 I've seen come out is John Reed of Solomon Smith Barney, who's been right on re EMC for a while. The uncertainty associated w/ the quarter & the rest of the yr. will hopefully be addressed positively tomorrow. The EPS for this quarter are not very important. Yes, a miss will hurt, but I'm confident that the #s will be good. The key to EMC right now is the fwd. look & how the co. addresses the rest of the yr. prospects, particularly those of Q4. My guess is the stock will pop a little, then base in the 108-112 area until the analysts come out & give shares a jump start.
