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Payne picks SSTI
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October 5, 2000: 5:27 p.m. ET
President of Wall Street Strategies also likes MRVC and Cacheflow
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NEW YORK (CNNfn) - Charles Payne, president, Wall Street Strategies, said Thursday that investors should regard Silicon Strategies and Cacheflow as potential long-term prospects. Payne also said that MRV Communications looks set to rebound at higher levels.
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Name: Mohammed (location unknown)
Question: JDS Uniphase (JDSU: Research, Estimates). I would like to know your opinion on JDSU and its acquisition SDL Inc (SDLI: Research, Estimates).
Answer: Even though JDSU has pulled back recently, I believe it's still a keeper and should be the leader in its space via its recent acquisitions. There are question marks about the current CEO, whose low-key style has kept him under Wall Street's radar. Still I think once the stock reverses through $100, it should trade to the $150-$160 range.
Name: Tom (location unknown)
Question: Silicon Storage Tech (SSTI: Research, Estimates). What is your 3-to-5-year outlook and the price target for the company for the next 12 months?
Answer: SSTI is my second-favorite flash memory play. My first favorite is M-Flash. Both stocks should experience tremendous growth over the next several years, especially with the shortage of flash memory chips. Technically the stock needs to close above $30, and from there it should make a fairly short-term move to $40. Long term I think in the next five years the stock should be worth about 200 percent over what it's worth today.
Name: Dave, New Hampshire
Question: Digital Lightwave (DIGL: Research, Estimates). What is your outlook for Digital Lightwave for the rest of the year?
Answer: This is an old favorite that's having trouble recently. The stock broke the 50-day moving average and is vulnerable to another 10 points on the downside. That said, we would recommend buying it on weakness. My upside target would be $80 intermediate term, and $95 longer term.
Name: Stefan, Germany
Question: Cacheflow. (CFLO: Research, Estimates). What do you think about Cacheflow? Is it a buy at these lower levels? How will the company do in the future?
Answer: It looks like the momentum crowd is bailing out of this stock as it's been under tremendous pressure all week long. I think the company has taken a leadership position in caching technology and that will drive the stock higher in the future. Unfortunately in the short term there's not a lot of technical support until $90. If you're long-term oriented, you have to wait it out. If you're more shorter term, look to become aggressive under $100.
Name: Mike, California
Question: MRV Communications. (MRVC: Research, Estimates). In the optics space, what is your opinion on the prospects for MRV Communications, in both the short and long term?
Answer: I've been recommending MRVC for a long time and the stock has been great at times and a heartbreaker at others. There are many naysayers that say the stock should be lower. I happen to believe the stock should be higher. Technically it has pretty good support in the $50 area, and when it rebounds, it should retest $80. I also believe there is a 60 percent chance the company receives a takeover offer in the next six months.
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-- compiled by Parija Bhatnagar
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