Air Methods (airm) Message Board

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Microcap & Penny Stocks : Air Methods (airm)

AIRM 42.95

0.0%

Apr 24 5:00 PM EST

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To: Mark[ox5] who wrote (129)	12/4/1997 7:39:00 AM
From: Elliot Lepler	Read Replies (1) of 877

Mark, You raise good points which deserve some comment. Brous is a regional brokerage, a small house out of Long Island and with an office in Phoenix. The analyst has followed Air Methods for a long time and has just recently put out a buy recommendation. This event is very significant, since as of this past spring there was no following on the Street. At that time Air Methods was picked up by a respected newsletter, the Red Chip Review. As of now Red Chip's projection numbers are not quite as high as Brous'. I believe that Red Chip is looking for 10 cents in q4 and about 45 cents for next year. Eventually I would like to see much more coverage by the investment community; Air Methods needs to meet estimates and develop relationships with analysts for that to happen. Several directors of the company own significant positions and the CEO and CFO have the appropriate incentives in their employment contracts. My concern with the management approach to the investment community is not related to their compensation. As I said, they are very careful what they say because of the previous history of hype. The company is ready to hire an IR firm because they now feel that they have a "story" to tell. Your question about valuation is a very good one. There are no directly comparable publicly traded companies.The closest comparable I can give you is the AMR ambulance company which was acquired at a price of 1 1/2 times sales early this year. Air Methods' sales with Mercy should be in excess of $50 million/year. A $75 million market cap would translate to a $9 share price, without assigning any value to the manufacturing business. I can certainly understand your decision to hold off buying right now. Looking at the price action the past few weeks, you certainly are not alone in that opinion. I have been involved with this company for the past three years and would have to agree that my money has been tied up a long time. But if it takes 4 years to triple your money, the final return rate is very respectable. I wish that I could have pinpoint timing with stocks, but long experience has taught me that I do better carefully researching a position and then sticking with it. Elliot

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