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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis

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To: Q. who wrote (1203)	6/19/1998 10:24:00 AM
From: drakes353	Read Replies (1) of 2506

John: Sorry, I was just kidding around. Here's some interesting balance sheet stuff. 12/96 9/97 Cash $27.841 $2.891 Net Rec. $16.025 $36.701 Debt in Current Liab $1.757 $10.518 Acc. Pay. $1.312 $5.445 Cash down 90%, receivables up 125%, debt coming due over the next 12 months up 6x, AP up 400% Looks like a first class liquidity crisis in the making. As you noted, companies that are generating "earnings" but not cash are usually doing something they shouldn't be doing. Even without whatever charge EQMDE is going to take I don't think they actually had any real earnings in '97. If this cash flow crisis continues I have no idea how they are going to pay off that $10 mil in debt. Also possible that one or both of the pending lawsuits (PRG and Onc Group) goes against them this year. They lose on either of those and they are toast. drakes353

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