The most recent issue of The Napeague Letter contained the following brief write-up on ABIX:
ABATIX ENVIRONMENTAL - ABIX:
On the evening of May 1st, Abatix released its 1997 first quarter
results, with the headline that "First Quarter 1997 Net Earnings
Decline 49%". The entire press release can be found at
biz.yahoo.com
I have received their 10-Q Report, but I have not had an opportunity
to review it. As I told you in my last Summary, almost every one of
the assumptions underlying my projection of the first quarter financial
results was "incorrect"; I was projecting stronger revenues and
slightly better gross margins, and "other expenses", which is largely
interest, exceeded my projections.
To quote the press release, "Our focus for the remainder of 1997 is to
improve the collection cycle and align our inventory levels to control our
bank financing. We are also expending efforts to improve our product
margins and to align operating costs with the current revenue and product
margin levels. Success in improving product margins is not guaranteed
because such margins are driven by the marketplace. We will reduce costs
if efforts in margin improvements and higher revenues are not achieved."
After the release of its quarterly earnings, ABIX fell to $2.25 per share,
on relatively little volume. Although I reserve the privilege of
changing my mind after I review the 10-Q and talk with management,
I sense that this price may represent an excellent buying opportunity
for long-term investors.
An Analysis of ABIX can be found at napeague.com - unfortunately this analysis is not up to date..... |
