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I don't normally create new threads, but this one is begging for comment. ATEC Group just made Inside Wall Streets Hot Stock of the Week today after reporting, yet again, phenomenal growth with minimal stock movement. This is possibly one of the most undervalued plays in this area. Read on and judge for yourself:
January 24, 1997
"A Key Technology Player"
ATEC Group is a full-service computer systems
integrator, primarily for small and mid-sized companies,
government agencies, and educational institutions. ATEC
provides its customers with a wide range of services,
including design, integration and installation of
computer systems, local area networks. high-volume data
communications, video conferencing and Internet-ready
solutions.
- ATEC's revenues for the first quarter of 1997 were
$25,600,000, up 80% from $14,200,000. Their earnings per
share doubled, up to $0.02 from $0.01.
- ATEC's net income for the first quarter ended
September 30 was $400,603, a 149 percent increase over
the $160,891 reported for the 1995 period. Net revenues
were $25,639,086 for the 1996 first quarter, up 80
percent from $14,279,684 reported for the 1995 period.
- The Company reported record fourth quarter and year
end results. Fiscal 1996 revenues were $81,812,045, up
72 percent from $47,565,542. Net revenues for the fourth
quarter were $23,608,831, up 35 percent from the
$17,475,676 reported for the same quarter of 1995.
- ATEC is the product of intelligent acquisitions. The
Company's "inductees" include American Computers Systems
Corp., CONY Computer Systems, Innovative Business Micros
and VDot.Net. Each business ATEC acquired has produced
dramatic growth in net sales.
- ATEC expects to continue to achieve record results
fueled by a combination of strong internal growth and
successful acquisitions. The Company continually looks
for profitable acquisition candidates that will
strengthen product lines through new and improved
technologies.
Founded in 1994, ATEC's key strategy has been to capitalize
on the proliferation of personal computers in the workplace
and the growing need for corporations to link these machines
into networks. ATEC offers leading computer products and
superior technical support to an industry dominated by large
scale, impersonal superstores and direct mail companies.
- ATEC not only sells the leading hardware and software, but
also supplies the service and support. ATEC develops entire
computer systems by integrating equipment and software from
various manufacturers.
- ATEC enjoys a high degree of repeat business and long
contract life cycles, leading to recurring revenues and
greater predictability.
- The Company's core systems integration market is growing
rapidly. By 1998, the domestic market is expected to grow to
$35.6 billion from $17.7 billion. In 1996 alone, U.S.
spending is expected to approach $28 billion for corporate
and personal integration solutions.
- ATEC's experienced management team and established
relationships with the world's principal technology vendors
pose substantial barriers to entry for competitors.
- Approximatey 70 percent of the common and common equivalent
shares are held by insiders.
ATEC is expecting revenues of 100 million for 1997 and
expecting a net income of 16 cents a share. This sector of
the market sports an average P/E ratio of 20.8 and a market
capitalization to revenues ratio of 1.25. This translates
into a fair market value of at least 3 to 5 dollars for ATEC
within a year. The stock is currently selling at around 75
cents due to a lack of retail interest and massive short
selling in the stock. The stock went into a level three
short restriction a couple of days ago due to the lack of
shares to short. The Company announced a 2 million share
buyback, and now has purchased 700,000 shares on the open
market of the two million, all of which will be restricted
and used for further aquisitions.
Furthermore, there is a rumor that the Company will purchase
a major competitor for stock when the share price is higher,
increasing total revenues to $250 million. The Company is
highly motivated to get the stock price higher and get the
Company NMS listed, for which it already qualifies, except
for the stock price.
Corporate Name - ATEC Group, Inc.
Symbol/Exchange - ATEC - NASDAQ
Shares Outstanding - 17,066,797
Estimated Public Float - 5,600,000
Recent Price - $0.71
52 - Week High/Low -$1.53 - $0.56
Contact Name: Michael Irving
Contact Phone Number: 407-875-1110
This week's Hot Stock of the Week was submitted by Michael Irving a subscriber to Inside Wall Street's E-news, a free E-mail newsletter. Inside Wall Street is an excellent website, worth exploring at insidewallstreet.com |
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