Bill Wexler's Profits of DOOM Message Board

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Strategies & Market Trends : Bill Wexler's Profits of DOOM

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To: Spunky Beaver who wrote (1717)	7/22/1998 1:33:00 PM
From: Graeme Smith	Read Replies (3) of 4634

I think it was my post you were talking about. The following is my latest update. I don't make any claims to its validity, I have seen very different outstanding shares and book value figures from different sources. Also a lot of the figures are pretty inaccurate estimates. I have modified my expected 2000 value to try to take into account the value of continuing business. I arbitrarily decided to multiple calendar 1997 earnings by 10 and add that onto the final value. My logic is that in 1997 most of the earnings are non-Y2K. And even if they are Y2K, the company must be fairly well run to have achieved them. The estimates are pretty inaccurate but enough to tell me the top 8 companies are all good shorts. A good indicator of the best shorts is P/S. Most companies will have no chance of meeting estimates in 99. The majority of Y2K is due to be completed by the end of this year, certainly all government and fortune 500 work. Yet somehow most of these companies are predicted to double their earnings in 99. I believe optimistic earnings might be 10% of sales for a body shop and 20% for conversion factories. After this or next quarter the sales should plateau. For example, even if ALYD triple their sales and achieve 35% net margin, they will still make less than a dollar a year in earnings. Outstd Market Book Sales/ Est. Earn. 1997 25 x '00 Todays Easy Easy Price Shares Cap Value Shares P/S earn. Until 'til00 Earn. 1997 Price Price Money Money ALYD 15 3/4 17.36 273 0.92 1.14 13.8 1.50 0.00 0.00 2.42 15.75 85% 154% ZITL 6 7/9 17.19 117 1.28 1.39 4.9 0.00 0.00 0.00 1.28 6.78 81% 137% IAIC 12 7/8 6.61 85 1.82 1.72 7.5 1.12 Jan-00 1.12 0.00 0.00 2.94 12.88 77% 121% TAVA 8 1/2 21.5 183 1.17 2.72 3.1 0.81 Jul-99 1.13 0.00 0.00 2.30 8.50 73% 107% IMRS 29 7/8 25.8 771 4.66 3.67 8.1 1.34 Jan-00 1.34 0.34 8.50 9.40 29.88 69% 95% DDIM 15 1/5 12.84 195 1.58 4.54 3.3 1.9 Jan-00 1.90 0.23 5.75 5.78 15.19 62% 79% CRYSF 12 11.05 133 0.00 2.21 5.5 1.42 Jan-00 1.42 0.40 10.00 5.42 12.06 55% 66% ACLY 8 1/8 7.97 65 1.59 0.97 8.4 0.87 Jul-99 1.22 0.09 2.25 3.71 8.13 54% 64% CMSX 23 1/2 14.59 343 4.44 5.04 4.7 1.65 Jan-00 1.65 0.61 15.25 12.19 23.50 48% 54% REGI 18 5/8 55.82 1040 3.73 11.87 1.6 1.64 Jan-00 1.64 0.52 13.00 10.57 18.63 43% 47% BRCP 18 1/2 14.15 262 12.36 7.84 2.4 0.00 0.00 12.36 18.50 33% 33% PTUS 6 16.16 98 1.8 2.89 2.1 0.57 Jan-00 0.57 0.27 6.75 5.07 6.06 16% 15% CACI 19 3/4 10.82 214 7.47 27.96 0.7 1.52 Jul-99 2.13 0.92 23.00 18.80 19.75 5% 4% VIAS 13 7/8 19.45 270 5.84 5.74 2.4 1.33 Jul-99 1.86 0.64 16.00 14.10 13.88 -2% -1% SEEC 6 4/9 6.08 39 5.60 2.41 2.7 2 Jan-00 1.74 0.46 11.50 11.94 6.44 -85% -51%

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