GTNR....Scott don't know when the write up is going to be posted on bizfn so here it is. Should be plenty of time for folks to use this as a starting place for some DD.
Gentner Communications Corporation
GTNR - NASDAQ SMALL CAP
Shares Outstanding: 8.12 M Float: 5.17
6 MONTH TARGET PRICE: $7.50
INVESTOR CONTACTS:
Address: 1825 Research Way, Salt Lake City, UT 84119
Phone: Bryce Benson 801.974.3602
Fax: 801.977.0087
E-Mail: bbenson@gentner.com
Web Site: gentner.com
Gentner Fax-on-Demand at 800-695-8110
GENERAL DESCRIPTION:
Gentner Communications provides telecommunications products and services including remote site
control and conferencing products. The firm also offers a nationwide conference-calling service, and
makes listening-assistance systems that transmit sound to the hearing-impaired at auditoriums and
other public areas. Gentner announced in November that it would be entering the video conferencing
market.
BRIEFING:
The Three Amigos believe that this is a ground floor opportunity for a company developing a new market
niche. Gentner Communications has made the right connections, has the quality products and the
management to benefit from a new, developing business trend.
Gentner is an established leader in providing tele-conferencing solutions. The Company announced in
November that it would be entering the videoconferencing market, and that it had contracted with RSI
Systems( RSIS) to use its video technology. The new product introduction is in February.
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Management has steered the Company well, establishing important relationships and recently increased
earnings expectations for the upcoming fiscal year by almost 30% after coming in with
a seventh quarter in a row of earnings increases.
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Institutions have found this stock and BUY recommendations are sure to follow as the
stock price goes over five dollars.
BACKGROUND:
Gentner offers strong management combined with a product line known for quality in a
market niche that has begun to attract serious attention from the corporate world.
Corporations will choose to teleconference rather than fly people in for meetings.
Additionally, the Company has made important symbiotic relationships to insure its future
as the market matures.
The Company has over the past year restructured the management team. CEO, Frances
Flood was formerly employed by Ernst and Young and has been promoted from Vice
President of Sales and Marketing, to President, and currently is the CEO replacing Russell
Gentner the Company founder. Susie Strohm, the CFO was brought in from Newspaper
Agency Corp. Kent Rogers formerly from Siemens is the Director of Sales.
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The new management team's strategy has been to develop synergies with companies within related
fields to enhance Gentner's distribution channels, marketability and to achieve full exposure for their
technological developments. Gentner has enjoyed mutually beneficial relationships with The Teletraining
Institute, Digital Xpress, Picturetel and most recently with RSI Systems.
digxpr.com
teletrain.com
picturetel.com
RSIS
Gentner's initial product allowed callers to be put on the air on radio and TV shows. The Company
continues to be the market leader in this area and has added teleconferencing and audio conferencing
equipment as well as products that monitor remote TV and radio towers. GTNR's product mix includes:
Remote Facilities Management.
Broadcast Telephone interface.
Teleconferencing room systems. (AudioPerfect)
Assistive Listening Systems.
Broadcast Telephone interface is what allows all of those people to be on a radio talk show, one at a
time, while the "screener" interviews the next guest.The company has had ever growing demand for its
AudioPerfect product and has found a perfect partnership with RSIS.expanding into the video
conferencing area using RSIS's product in conjunction with AudioPerfect.
Gentner was awarded the International Communications Industries Association's "Best of Show" award
at the INFOCOMM International 1998. GTNR is a scheduled presenter again this year at INFOCOMM,
June 10th at Orlando Florida as it introduces its new videoconferencing product line.
infocomm.org
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Institutions have become attracted to this stock and have taken initial positions. Institutional investor
Watson Investment Group has taken a 5% stake in the company and Kennedy Capital Management has
also bought shares. We expect that Institutional interest will pick up as the stock price crosses the five
dollar range and the stock becomes eligible for a Nasdaq National Market listing.
TECNICAL ANALYSES:
Short term technical indicators are neutral. Volume has been increasing the past 5-7 trading days. At
present it appears to be some distribution of the stock . The other indicators seem to support weakness.
Stochastics are in the 80 range but have been higher recently. MACD also is neutral after a weak sell
signal when the stock first hit new highs. RSI (59) has broken down below its trendline and points to
lower ground. However, GTNR has been holding its 20 DMA since October and is in a nice solid uptrend.
Watch closely to determine entry point.
The Intermediate term technical indicators are strongly positive. Stochastics are in the 90 range and
have more room to run. MACD is also very positive and has indicated and confirmed a buy signal in
November. RSI (81) is advancing sharply higher. The last four weeks, GTNR has hit the high mark but
failed to advance. We are looking for a small pullback (very healthy) and will buy as trendlines are
confirmed.
CONCLUSION
We believe that the first two quarters of 1999 reflect the outstanding growth opportunities for the
company. CFO and VP of Finance Susie Strohm stated "Based on our pipeline of sales for the
upcoming quarters and our capacity to keep our expenses in check, we are comfortable re-forecasting
our yearly earnings per share to $0.23 - $0.26 for fiscal 1999 from our original projection of $0.18 -
$0.23,'' This re-forecast represents a 28 -44 percent improvement over fiscal 1998 earnings per share of
$0.18.
The improvement in the balance sheet from year-end 1998, two quarters ago is quite impressive.
Revenues increased 39% along with net income increasing 107%. Earnings per share have doubled from
.06 to .12. The company's cash and equivalents have greatly improved from $ 715,325
dollars to $ 2,567,405 in the same 6 months. They have been able to manage their inventory, reducing it
almost $1,000,000 dollars or approximately 30%.
Management has shown us the ability to effectively operate the company. We are confident that Frances
M. Flood, president and chief executive officer for Gentner, will do what she stated. ''We remain keenly
focused on growing the organization year over year, both consistently and profitably, and we will continue
to expand our distribution channels and product/service offerings in order to capture our fair share of the
burgeoning markets we serve. We look for good things from Gentner Communciations in the future."
We see the new alliance with RSI Systems as an explosive growth component to an already exciting
growth story.
FOR MORE INFORMATION:
GTNR RESEARCH:
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