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Technology Stocks : COMS/USRX

COMS 0.00150

-28.6%

Dec 11 9:30 AM EST

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To: sunny who wrote (781)	3/11/1997 7:14:00 AM
From: Alan Casey	of 1384

I think there may be a logic error in your analysis. e.g. if NIC's sales price is reduced by 40%, and gros margins were running at ~ 50%, the new gross margins on this product line would be (100-40)/50 = 20%, a drop of 60% in profits. I f NIC's (say) represent 50% of sales, NIC's would have previously generated 0.63 * .50 = 0.32 eps. A 60% drop in this product line would therefore cost .60*.32 = .0.19. Earnings of 0.63-.19= 0.44?? Please also correct me if my analysis is wrong or too superficial, but I think the cut in prices is more significant than 10-12 cents per share. BTW, I am long COMS!!

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