CYCOMM (CYII)-on aquisition trail Message Board

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Microcap & Penny Stocks : CYCOMM (CYII)-on aquisition trail

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To: James W. Bradsh who wrote (1642)	1/1/1999 6:07:00 PM
From: Robert Morrison	Read Replies (2) of 1800

You will see merger/takeover activity in the market generally when companies can no longer increase share values through earnings at the same rate and have only the reorganisation of their balance sheets (eg issuing stock or using excess cash balances) to acquire other companies left to increase their overall market revenue share and decrease costs through merger of operations. This doesn't necessarily make Cycomm a target until buying its assets can increase the acquirer's bottom line at a greater rate than interest paid at the bank - in other words steady profits must be present. 1999 will be a year of improvement but I feel we will still be in for a ride up and down until probably 2000. Moreover Cycomm is in a new market so it is not a straight out profit buy for an acquirer. For example, if you look at the takeover of NATL by DRS you will not see the share price on fire for NATL stock because it is still in an uncertain market with nobody making any sizeable profits (yet). The trading range is now $1 7/8ths to $2 1/2 (resistance level) and I think we will be stuck in this mode until we get a shock to the system. Don't think a shock will be announcements. The lack of response to the State Dept contracts confirmed in my mind that nothing other than promotion with profits in the saddle-bag will now work. In regard to advertising the point of branding Cycomm with secure computing should not be lost. Corporate America likes to deal with winners or at least those companies perceived to be winning. It easier to take on a company seen to be No 1 in the market as a supplier over a company that needs to explain itself and its existence to each and every customer it approaches. This has already been stated to be a problem with some of the larger city police forces who have been burned by small suppliers going out of business (eg Badger). Right now a buyer may only ever have been acquainted Panasonic with radios and TV's and didn't know they made computers let alone rugged ones but at least he or she knows the name of the company and that it has been around for a long time. Cycomm can claim a superior product but not the same recognition. It may however rely on testimonials from other buyers (eg Phillie Police) but you can't always use these in the broader market. If Cycomm did some Internet advertising and offered rugged/Tempest computers for sale on-line then this perception would take hold both with potential buyers and (importantly) with potential investors. On top of this there must be many field professionals who are in need of rugged machines and are doing well enough to buy them as individuals (tax deductible) and could order direct. Look at Internet stocks like Ebay. You see the stock listed and the advertising of their site in a banner on your browser and this makes you feel that yes it is happening for this company and you were right to buy the stock. Cycomm must avoid the softly-softly approach to doing business or risk becoming perceived to be a bunch of geeks fiddling around with technology but not serious in the big market. Remember Slice. We don't want to end up with the same lacklustre response to a great product because the market (which is still there) wasn't handled right. Rob

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