<<Maybe a good idea to have money in both? Comments?>> Paul, I have concentrated on Valence and therefore did not participate in ULBI's move from around $10 to $20 (now pulled back to about $16.) In the same time period, however, Valence has moved from the 4's to the 9's and has pulled back to about $8.
I attribute ULBI's upward move primarily to their contract announcements, media coverage and their history of non-rerchargable revenue that has helped them meet more analyst criteria.
Valence, on the other hand, has yet to see the effects of contract announcements(ignoring the $25+/sh approx 4 yrs ago) and an equivalent degree of media and analyst coverage.
Here are some additional thoughts:
1)Valence has 22.7 mln shares outstanding compared to ULBI's 7.9 mln.
2)Valence's line 1 and ULBI's line 1 should be approximately equal in production capability.
3)Valence's high speed lines are expected to have more than twice the capacity as their line 1 from the Florida Mfr.
4)By March '98 Valence will have their line 1 plus 3 high-speed lines in their Ireland plant alone. Although they won't be running 3 shifts, The combined capability should be over 7 times that of their line 1 and would therefore appear to be over 7 times ULBI's known Solid Polymer capability.
5)Adjusting for the number of shares, Valence would appear to have 7.9/22.7 x 7 = 2.43 times the lithium polymer production potential per share, based on these first four lines. We don't know of course, when ULBI will add another line.
If you then consider their significantly greater R&D investments, joint ventures, General Motors, the estimated $200 mln it would cost them vs $700 mln for the Japanese to build the next plant etc, it becomes apparent that Valence may very well be the "dominant supplier of laptop and cellphone batteries" in 1998.
A good idea to have money in both? It is always safer to diversify. My available funds, however, will continue to be directed toward Valence.
Best Regards, FMK |
