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Technology Stocks : Avid Technology

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To: Larry Abrams who wrote (210)	4/24/1997 12:06:00 AM
From: Wilson Chao	of 777

Larry, your "balance sheet first, then P & L" comment was well put. Avid's press release with their quarterly results is at biz.yahoo.com and it documents the continuation of an interesting trend in their balance sheet. Their "cash & securities" (ie. working capital) has been steadily growing: 12/94 $36 million 12/95 $50 million 12/96 $93 million 3/97 $141 million ('94 & '95 #'s are from the 1995 annual report at their web site) This tells me several things: They didn't need Intel's cash ($15 million). The four quarters of losses (totalling $20 million in 1996) didn't require them to eat into their working capital. They can afford fight for market share with aggressive pricing, as they have effectively done in the last quarter. They have increased their working capital by 50% in the last 3 months! This looks to me like they are building a war chest for aggressive action.

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