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Technology Stocks : Information Architects (IARC): E-Commerce & EIP

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To: Larry Brew who wrote (6639)	6/24/1998 9:29:00 PM
From: JG	Read Replies (4) of 10786

Interesting post from the Yahoo message board! Finally some news to read Stocking_stuffer Jun 24 1998 8:42PM EDT I have not posted in a while due to other opportunities. Well here it goes. Feel free to pass this on, or post elsewhere.This is a long post, but is information from an analyst in Switzerland that is following ALYD and has a strong buy recommendation out on the stock. There was a writeup on him in the Charlotte Observer a while back.A friend of mine spoke with him a couple of days ago.1.He has been following ALYD for a couple of months.2.He sat down with ALYD management and they said they could do 65% EBIT margin. He replied that nobody does 65%. Intel does 40%. ALYD reassured him that they could do 65%. He used 45% EBIT margin for all of his estimates.3.He visited British Airways last week. Their head of Y2K is very satisfied with ALYD. BA gave ALYD 4 million LOC. ALYD did the job + partial test for ~45c/LOC. ALYD astonished BA by turning over some code in 5 days! BA was very satisfied with the results and error rate of the COBOL and PL1 code, but the error rate on some code in DL1 (whatever that is) was higher than promised. This work for BA was for their cargo and engineering division. BA's operations side has not done anything yet. ALYD is approaching all the other divisions at BA.4. Average billing is up to ~45c/LOC in the US, but in Europe ALYD is getting ~60c/LOC.5.In Switzerland alone ALYD has 12 customers ~15M LOC so far. Right now they are primarily working on 2 contracts- a bank and a freight forwarding company. ALYD has either talked to or has a contract with the state of Geneva which has up to 30M LOC.6. The cycle time is still very long with at least 180 days still from start to last payment. Most of the deals with bigger customers are structured so ALYD gets paid a large portion at the end or after everything is done.7. The Compuware agreement has turned into a real win/win agreement. CPWR has some tools that do the comparison and ALYD does the conversion. CPWR bundles everything and sells its tools to the customer. ALYD still gets its full rate of ~45c/LOC on deals thru CPWR.8.CPWR introduced ALYD to the freight forwarding company and within the last 2 weeks introduced ALYD to Fiat. They have 300M LOC, of which 15% is mission critical.9. ALYD intends to make acquisitions of companies with big Y2K liabilities.10. Estimate for the 2nd quarter is sales of $12.9M, with net income of $3.9M, which is 22c/ share. He may take it down to 19c/share due to a 1 time charge of $350K which may be paid this quarter. For the rest of this year he has 43c in Q3 and 72c in Q4 for a total of $1.47 in 98.11 His estimates for 99 are as follows: Q1 Q2 Q3 Q4 Total 0.79 1.02 1.30 1.62 $4.7312. ALYD has increased its capacity to 350 to 700Mil LOC/year. They are currently running at 60% capacity of which half is billable and half is pilots, etc.13. He does not have buy recommendations on any other Y2K stocks. He looked at some but their margins weren't high enough for him14. He was buying the stock from 4/15 to 5/15 and his average price is ~$16.0015. He has spoken with 2 analysts within the last couple of weeks. 1 from Oppenheimer and another from a hedge fund.16. ALYD could make some kind of announcement related to contracts every day but are very reluctant to hype. ALYD in Europe is much less shy about talking and he talks to them every other day.17. He wrote an article on ALYD, or was the source for an article in a Geneva newspaper on either 5/13 or 5/20. That caused a spike in volume to 430K that day. David Boraks of the Charlotte Observer did not talk to him when he had that blurb in the paper on 6/8. 18. His price target is $110 Other news -According to Media General Financial's web site, in the last week, or month institutions have bought an additional ~4M shares of ALYD, bringing the total of institutional ownership to 28% by 14 institutions.If this guy is even half right, this baby will fly. ALYD: Quote \| Profile \| Research This Is a Reply to: Msg 168 by RichinY2K <- Previous Message 169 of 169 Reply

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