USRX Message Board - Msg: 692759

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Technology Stocks : USRX

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To: ria who wrote (8780)	1/21/1997 9:17:00 PM
From: Don Edgerton	of 18024

Sood's shorts must have gotten squeezed and he is still trying to bail them out. I believe the conference call addressed the receivables issue. To wit the increased international sales have a longer receivables cycle and there was channel replenishment late in the quarter. Inventory drawdown was impressive. Inventory turns increased from about 6 to 8X Receivables are not a real issue unless they are of poor quallity. Assuming trade practices of providing a discount for early payment (don't know if they use it) delay beyond net payment periond would give a higher return than money in the bank. I believe margins should increase with the sell through of the new modems at a $60. premium to the 33.6. See no reason that the true X2 should cost any more than the 33.6 to manufacture. Believe discussion about fall off in shipments of access products with renewed orders for 1st calendar quarter could be re AOL. They had a slow down in subscriber growth in the summer which only begin to pick up in the fall. It accelerated in November. Then when the flat rate plan hit, demand exploded and that is likely when the orders hit USRX. USRX had little or no spool up time and MCI can only install them as they become available. Anyone agee with my conclusions? Don

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