Judging the source:
To: TK (52 )
From: FMK Saturday, Feb 1 1997 9:47AM ET
Reply # of 6098
I heard Montgomery Securities was there- anticipate a (strong) buy rating.
Someone may have mentioned that there should be no taxes on approximately the first $100 million in revenues because of prior year losses (see page 13 of the last annual report & the last 10Q's & confirm). This should give earnings/sh a nice running start!
To: Paul Dubsky (33 )
From: FMK Monday, Jan 27 1997 7:57PM ET
Reply # of 6098
FIRST PRODUCTION LINE IS NOW OPERATIONAL. Test runs are being made and batteries will be available for the shareholders mtg on the 31st! I heard this from a broker who had just spoken with Calvin Reed, CEO.
They worked out an OEM agreement for TI portables, but may now be dealing with Acer who purchased TI's notebook division last week. This does not exclude other OEM's
When asked about announcements, Mr. Reed explained that their legal dept advised them to suppress news for now.
Speaking of tankers-- I've been loading MY boat with VLNC!
Looking for $20+ by yearend.
To: Paul Dubsky (29 )
From: FMK Saturday, Jan 25 1997 12:02AM ET
Reply # of 6098
Paul, I'm glad you're going to hang in there. I have since learned that the production lines should be able to produce 7 mil/yr of the larger (computer) batteries (est $20 wholesale) or can be be reconfigured for approx 20 million/yr of the smaller (cellphone) batteries (est $10 wholesale), at a target of 40% profit margin.
The company expects to have batteries coming off the first line at the end of March, when analysts are planning to visit. It's been hard to wait, but contracts with the likes of Motorola, HP, etc, could confirm the above data for their forecasts.
Can anyone explain why the stock is still so low?
To: FMK (62 )
From: gvander Tuesday, Feb 4 1997 7:25PM ET
Reply # of 6099
Read this carefully . . .
Every so often on a thread like this one you are going to attract the attention of someone who knows the industry very well. That said, I am only going to participate in this once -- here are just a few thing that I think have been over looked:
1. Valence clearly states that it does not expect to even begin volume production until 1998 -- you overlooked the fact that its competitors will begin producing commercial volumes in 1997 and have been operating pilot production lines since 1995 (Valence plans to start "prototype production" in 1997).
2. Valence has never produced commercial quantities of anything -- you may want to look at their 10-K a little closer "To date, the Company has been unable to produce commercially-viable prototype batteries, based on its new technology"
3. I am being kind in not commenting on this next issue -- Reputation:
Read this case before anything.
IN re VALENCE TECHNOLOGY SECURITIES LITIGATION
No. C 94-1542-SC
UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
CALIFORNIA
1995 U.S. Dist. LEXIS 10379; Fed. Sec. L. Rep. (CCH) P98,793
May 8, 1995, Decided
May 8, 1995, FILED, ENTERED
4. Also, there are at least 15 other licensees of the basic bellcore technology since 1994 who have been working to improve it since then. Valence just got the license in 1996 and has made no improvements. You may also want to think about who has the most favorable licensing terms -- I doubt it is Valence given the fact that it procured the license after the industry recognized the value of such a battery.
5. Even with the order from the Army Valence is selling at 120 times sales
My main point in this is to suggest that it is clearly too early to be making production estimates like the ones in this thread -- I remember the same type of "production estimates" being touted when AERN was at $9 dollars -- there were fundamental flaws in the AERN bulls' arguments also, but instead of learning the industry better they became hostile. Needless to say AER now trades between 2 and 3. This industry is fundamentally attractive and there will be a company that leads the lithium battery industry but it will probably not be Valence --
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