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Technology Stocks : VALENCE TECHNOLOGY (VLNC)
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To: shasta23 who wrote (1621)12/9/1997 10:28:00 PM
From: FMK  Read Replies (2) of 27311
 
Stephan, I was read the ULBI announcement stating that they are about to receive the last piece of equipment for their first solid polymer line. They referred to it as high speed but it from the same mfr as Valence's line 1. ULBI states that they intend for it to go into production Q1 '98 but cautions that it may take a while to production qualify. Remember when Valence was in that stage?

Bill Sharp's recently added the capability of Valence's first 3 lines to conclude that Valence had 5 x 8.9mln sh/22.7 mln sh or 1.96 times the production capability on a per share basis.

With ULBI's stock price now at 17.375 and VLNC at 5.578, A dollar invested in Valence would then purchase over 6 times the solid-polymer production capability as a dollar invested in ULBI.

Granted, ULBI already has revenue from non-rechargeables but as I recall, still has an earnings loss/sh and a concensus that most of their run-up has been from their solid polymer potential.

If ULBI is fairly priced at $17/share, I believe Valence is tremendously undervalued. Please let me know how you would evaluate the capability and earnings potential of their line 1 vs Valence's lines 1-3. Remember that Valence's lines 1 and 2 have been operating in the Northern Ireland plant for many months.

Regards, FMK
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