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Microcap & Penny Stocks : Rocky Mountain Int'l (OTC:RMIL former OTC:OVIS)
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To: Joe Master who wrote (28611)12/18/1997 10:11:00 PM
From: Skeeter Bug  Read Replies (2) of 55532
 
off topic: joe, actually, i emotionally state my empirical opinion. there is a difference ;-)

hey, mu will have $30-$40 million in extra depreciation and sga over then ext 3 qs. that is, $30-$40 mil per q avg. a total of $90 mil.

that is about $0.15-$0.18 more of a loss, per share, that they have to recover going forward. not easy.

their asp was $4.80 last q. it will be very near to $3.00 this q. that will be hard to compensate for.

they changed their accounting procedure this time to mask MASSIVE INVENTORY PROBLEMS. they no longer carry at the lower of avg cost or market b/c market is now below cost.

expect a loss over the next 2 qs before mu has a chance to even think of making money.

$24-25 is too expensive for a company that will maybe earn $0.20 THIS YEAR. is a 120+ FORWARD pe too much to pay for a commodity chip company w/o deep, deep pockets in the midst of a SUPER GLUT FROM HELL? me thinks so.

wait it out, imho. you will be able to buy mu in the single digits over the next 6-9 months.

as for mu being the low cost producer - this is just a rumor put out by, well, mu. the fact is that mu is very competitve on price with A LOT OF OTHER VERY GOOD MANUFACTURERS. mu doesn't know what their cost is.

the latest upgrade at this point in time is an obvious sign of distribution before the third foot falls on mu.

puts are in order here, not a long position.

jmho.
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