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Technology Stocks : TAVA Technologies (TAVA-NASDAQ)

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To: M. Frank Greiffenstein who wrote (27826)	2/11/1999 11:55:00 PM
From: Mark L.	Read Replies (1) of 31646

"All I can figure out is that the balance sheet is still crappy." The balance sheet is not crappy. It's good and improving rapidly. And you're getting this opinion from someone with a substantial short position. There may or may not be a good reason for the stock decline of the last two days. However, there is a good reason why people are short the stock. As impressive as management's performance is to date, their task post-Y2K is daunting. This quarter, when they had the benefit of massively increasing revenues, they reduced SG&A by only 1.5%; this is not the kind of tough management that's going to be required in a year. It's going to be a very ugly picture in late 2000, unless Jenkins and his colleagues are extraordinarily tough and talented. I'm not saying it'll be impossible to be profitable then, but I'm saying the odds against it are long. They're either going to have to have a fantastic increase in core business or massive layoffs. An earlier poster said that the current revenues are 60-70% core business. I would encourage him (and others) to look closely at the transcript of the conference call.

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