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Technology Stocks : American Power Conversion

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To: Ken who wrote (1422)	6/4/1997 4:49:00 PM
From: JimieA	of 2574

I agree with you that APCC is not efficient in inventory managment. They are better at collecting their receivables though. Although for the last quarter they did not do very well in either. Below are some statistics I worked up for APCC. Quarter Ended 12/95 3/96 6/96 9/96 12/96 3/97 Acc. Rec. - DSO 45 47 48 48 47 56 Inventory Turnover 2.2 2.4 3.2 4.0 3.6 2.4 APCC's explanation for increase in inventory is new product Symmetra and new manufacturing facility. I think you are comparing them against tough competition in Dell, who is great at shipping made to order computers as well as Compaq Intel. These companies are not in the same business. A comparison with another investment I have, 3COM may be better: Quarter Ended 11/95 2/96 5/96 8/96 11/96 2/97 Acc. Rec. - DSO 53 55 49 53 51 58 Inventory Turnover 5.5 5.3 5.1 5.7 6.3 5.6 As you can see, 3COM is doing about the same in collecting receivables. Even a little worse. While they are a lot better at controlling their inventory. But both of these companies have been very successful in leading the market they are in 3COM in LAN networking and APCC in power protection. And in generating decent returns on shareholders equity. I hope this has been some help.

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