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Strategies & Market Trends : Value Investing

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To: FIFO_kid2 who wrote (4522)	7/29/1998 1:33:00 PM
From: 18acastra	of 78744

Globaltech (GAI) trading slightly over cash and only 2x EBITDA and good prospects/growth. 12.83mm shares x $9 share = $115mm mkt. cap - $70mm cash = $45mm business value. Trailing EBITDA is $23mm, versus $8mm EBITDA previous year. Taken public recently at $19/share by Furman Selz. Missed first Q out of the gate, Wall St. has been mercilous. Sunbeam was a 30% customer - therein lies the problem. Good news is that business ex. Sunbeam apparently growing 30%/40%, and company growing enough around sunbeam to hold earnings flat as Sunbeam business drops off. Eventually this issue worked through, and normalized growth returns. Globaltech is an orignal design manufacturer of consumer applience's for OEM's (i.e. they design and manufacture things like breadmakers and foodsteamer's for companies like Sunbeam, Moulinex, etc.). Globaltech has been growing so quickly because located in China, so cost structure is 50% of domestic OEMs, and time to market also much quicker with original design capability. Seems like a compelling value. My opinion.

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