CHPS Message Board - Msg: 1847530

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Technology Stocks : CHPS

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To: D. Swiss who wrote (2202)	7/27/1997 4:59:00 PM
From: Alex Burns	of 2740

>I don't understand why they bought for themselves but not for the company< I don't either, but perhaps they have better plans for use of the cash. They may have needed to get approval from the Board or shareholder for a stock buyback plan... It would kill us if they raised cash by placing a secondary offering or raising debt securities. Thankfully, we don't have to worry about that happening. I'm just speculating, but they could buy out a fabricator if they wanted to. I just use this as an example of what they could do to increase shareholder value. That's assuming that they made an acquisition that's accretive... This is a conservative management team. They try to keep expectations about earnings and revenues low. Last quarter, they said this quarter would be down 10% and it turned out to be flat. Now, they're saying this quarter looks flat. I bet it'll be up around 10%. The next generation products are coming out in December... So we're in a product transition period although the old and existing products keep doing better than they expected... I think the analysts know CHPS management well enough by now and will adjust their earnings projections and target prices accordingly. I think we'll start seeing the results of that adjustment process this week. Alex

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