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Technology Stocks : Catalyst Semiconductor (CATS) -- What's New?
CATS 25.89+1.6%Jul 2 5:00 PM EST
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To: Cary Salsberg who wrote (51)11/21/1996 1:16:00 PM
From: JACK SHOYKHET   of 436
 
Cary:
I hope you were able to participate in a Conference Call this morning. It was horrible -- for the first time I truly understood your reservations about this company.
Here is my bottom line assessment:
1. Very mediocre management - their performance with the troubled investors was less then adequate. No idea of where the company is going short term, and even less idea in the long term.
2. Management had been effectively selling their shares all along. (insider selling). Mike Powell revealed that he sold 25,000 shares in September, "not knowing what results CATS will come in". BS.
3. Erosion in flash memory pricing - 20% in the last Quarter causing reduced bookings and revenues.
4. Company's effective book value is at $2.00/ share - pitiful.
5. They are laying off 35% of the work force - 35 people x $30K = $1MM. (too little, too late).
6. Powell said he has "no plans to sell the company to increase shareholder's value"
7. They have no outside coverage by anyone - left to their own devices.

What it all means to me is that the stock price will continue to be depressed for the next 12 to 18 months, until they can either produce new products (8 or 16 MB) or someone offers to purchase them. They only have $12MM credit line till April'97 - if situation does not change, they will be under pressure to start re-paying or face downgrading of their credit worthiness.

I am out - totally. And I am NOT coming back.

Good Luck to all..
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