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Technology Stocks : TAVA Technologies (TAVA-NASDAQ)

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To: bob oserin who wrote (16919)	5/14/1998 2:00:00 PM
From: Rick Bullotta	Read Replies (2) of 31646

I was very, very impressed with the figures that their CFO provided on the cost of hiring the 70 employees last quarter...they seem to be managing that aspect quite well... From what I know, billable rates at present are more in the $150 range, but are expected to approach $200 (per Jenkins) as the urgency increases and availability of resources decreases (hey, that economics stuff really does work!)... The margins they're getting on this work are also very good, due to the nice billing rate, the high percentage of billable hours per employee (very little "dead time"), low cost of services (assessors don't need to be $70K a year senior engineers), and low risk due to time-and-materials projects versus fixed price work. I do think you'll see the net results on the bottom line in the next 2 quarters...figure that each "warm body" has the potential to add about $150K of margin if the sales effort can keep up (which I believe it can), which is quite impressive...EPS in the next two quarters will be orders of magnitude better...

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