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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: thumbelina who wrote (41516)	5/23/1999 4:24:00 AM
From: lee kramer	Read Replies (1) \| Respond to of 120523

SWS announce after Friday's close that they filed with the SEC an offering of $50,000,000 Exchangble Subordinated Notes, due 2004...exchangeable at maturity for shares of NITE (they hold 3.4 million shares). Had this been a "secondary" offering of stock the implications would be that SWS has likely seen a temporary "top" to it's recent run. But this appears to be "borrowing" against their NITE holdings. At NITE's current price these holdings have a market value of 221 million. In effect they are borrowing 50m or 22% of the value of their NITE holdings. Money to be used for "general corporate purposes." My take on this; a sharp move. They beef up their balance sheet, nicely increase cash-flow, probably to spend part on their on-line brokerage unit...looking to increase earnings over time. I will re-enter SWS on any weakness. (Lee)