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Technology Stocks : Carnegie Group CGIX (READY FOR A MOVE?)
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To: bsl113 who wrote (41)2/5/1998 10:34:00 PM
From: PeterGx  Read Replies (1) of 110
 
Well Bryan:

I certainly was not impressed :-) by the company's performance as described in the '97 Annual Report. 4% revenue growth just does not make for a great "growth company". But this was already "old news".
I share your optimism about the industry's growth prospects.(around 30% per year)
I also believe that it is possible for CGIX to carve out a niche in the systems integration/IT consulting business.

Management seems to recognize the important issues facing the company and the steps required to turn CGIX around:

"We remain focused on cost reduction and increasing top line growth through our partnering programs and new account sales efforts."(from the 4Q)

1) Improve their sales efforts.
2) Cutting costs
3) Shift their client focus (away from heavy reliance on Gvmnt projects and towards private business clients and partners)

Seems like CGIX are focused on actively pursuing the cost-cutting effort. However, IMHO (1) and (3) are the key elements that will ultimately determine CGIX's performance (in the next 1-3+ years)

I guess, we just have to wait and see how management handles these issues.
HOPEFULLY, company news releases will keep us (investors) informed about these developments (1 and 3)

Last but not least, @ $3 CGIX (with its current financials) looks fairly safe to me as far as a risk on the downside is concerned. Should revenues start to pick up in the next 3-4 Qs, a renewed growth potential could easily push the stock to double...
I have a small position in CGIx now and would certainly be watching for new developments.(invest more if positive)

Best of Luck!
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