Bruce Mushial of StockTradersPress.com
June 23, 2000
Sage Host: Please welcome Bruce Mushial, senior
technical analyst at StockTradersPress.com.
Bruce Mushial: Good morning. I'm glad to be
here again. What I'd like to do this week is similar to
what we did two weeks ago, where you provide me individual
stocks that you want an opinion on, and I'll do my best
to offer an opinion based on technical and fundamental analysis.
Question: What do you think the Federal
Open Market Committee (FOMC)
will do at their meeting next week, and what effect will
their decision have on the financial markets?
Bruce Mushial: I think there's a good probability
the FOMC will pass on raising interest rates in
the June meeting. This should be very positive for stocks.
Question: What do you think of Compuware
Corporation [CPWR] and Carnival
Bruce Mushial: Let me pull up their charts.
Compuware is towards the bottom of its recent range.
It actually looks attractive at these levels. It may move
up slightly and then lower before it climbs. Earnings look
positive for the coming year. I am noticing that there are
a large number of analysts that have a hold rating on the
stock. Currently, there are three analysts with strong buys,
zero buy recommendations and eight analysts with a hold
recommendation. This is fairly unusual, and would concern
me. Before I bought the stock, I would want to know why
so many analysts have a hold recommendation. Carnival
I can't give a technical opinion on, but looking at the
fundamental information, earnings look good for the coming
year. For the current year they're expecting $1.75 per share,
next year $1.97. There are two strong buys and 13 buy recommendations.
It looks like an interesting stock to do more research on.
Question: What is your opinion of major integrated
oil company Conoco Inc. [COC.B]?
Bruce Mushial: Earnings actually will be
lower next year than this year. Analysts' ratings are strong
with five strong buys and six buys. The oil sector stocks
are generally going to do well because of the higher price
of oil currently. Probably a stock to do more research on.
Probably a reasonable buy.
Question: Do you think it's likely that Nabisco
Group Holdings Corp. [NGH]
will be bid up to $31 per share by Carl Icahn?
Bruce Mushial: I haven't been following
Nabisco Holdings. In a buyout situation almost
anything is possible. Try to keep your head screwed on,
these could be very volatile times. Don't get ahead of your
Question: Do you expect momentum buyers to continue
to push Rambus Inc. [RMBS] to higher
Bruce Mushial: Rambus had an amazing
story over the last week. Currently, it's trading at $134
in the premarket. We would all love to see Rambus go back
to $400. I think we're a little too high at this level,
and rather than chasing the stock, it's probably more prudent
to buy it on the next pullback.
Question: Will the US Airways Group,
Inc. [U]/UAL Corporation [UAL]
merger most likely be blocked due to antitrust concerns?
Bruce Mushial: There is a good chance that
the Justice Department will have concerns about the merger.
They may have to sell certain routes before it is approved.
The airline mergers probably spell bad news for consumers.
Reduced competition probably will allow for higher profit
margins, which will be good news for shareholders.
Question: Does it make good business sense for British
food conglomerate Diageo plc [DEO]
to spin off of its Burger King unit?
Bruce Mushial: I don't really have an opinion
Question: Currently, what are your three most favored
Bruce Mushial: It depends if we're looking
at long-term or short-term. Recently the Stock
Traders Press has made a number of recommendations
that have done quite well. In six weeks, we're up over 25
percent on Priceline.com Incorporated
[PCLN]. I think for the long-term, The
Home Depot, Inc. [HD] looks very
attractive here. We also like Solectron Corporation
[SLR]. Short-term trading in this market has been
very difficult. The market has been extremely choppy; a
lot of short-term investors are getting whipsawed.
Question: Is it time to lighten up on oil service
Bruce Mushial: Oil service stocks have run
up. It may be time to lighten up on positions. Relatively
high oil prices are probably here for the coming year, and
a number of stocks will benefit from those higher prices.
There is also going to be a natural gas shortage in the
Northeastern part of the country, and there will be a number
of industrial companies that will be hurt by this due to
Sage Host: Thank you for joining us today,
Bruce! We appreciate your insights!
Bruce Mushial: America Online,
Inc. [AOL] members can check out our Web site
at stocktraderspress.com for a trial subscription
to both our long-term and short-term research reports. Next
week's format will again look at individual stocks, and
I encourage members to prepare their questions.
* * *
Thanks to SageCrystl for hosting this chat.
First Editor: SageGrits
Final Editor: SageMojo
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