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Non-Tech : Ashton Technology (ASTN) -- Ignore unavailable to you. Want to Upgrade?

To: Steve Gardality who wrote (1774)	6/16/1999 3:40:00 AM
From: Candle stick	Read Replies (2) \| Respond to of 4443

Below is a rebuttal to the Lowensteiner article on IIonline. It was not written by me, but is definitley worth reposting. I hope the original author does not mind: The tone of your article makes me wonder if the content of your online and offline offerings are directed at INVESTORS or traders. I post the following refutation with the belief that both sides of the issue should have a fair and accurate weighing by intelligent investors. In the first sentence you compare Ashton Technology Group to Iomega. I see a few similarities between the stocks. I quote the following from the foreword of The Motley Fool Investment Guide by David & Tom Gardner: “In the spring of 1995, Iomega came out with a revolutionary disk drive whose disks held seventy times the capacity of existing floppies. Between the initial announcement and the debut of its Zip drive, Iomega shares took off, running from $2 to $10 in a matter of months. The rise drew strength from the expectations created by the five-star reviews that computer industry rags lavished upon the new product that was universal and without reservation.” Hmmm, yes the first part sounds like ASTN - a revolutionary new product and flying from $2 past $10 (at one point returning 789%). We (ASTN longs) are now at that point between the initial announcement and the debut of ATG's new product. BTW, the new product I am speaking of is VTS - Volume weighted average price Trading System,which was, inexplicably, never mentioned in your analysis. (Could it be that you do not have the time it takes to understand VTS?) However, ASTN has not had any five-star reviews lavished upon it. It has not been discovered by the Wall Street or the Main Street investor, yet. TMFIG foreword continued: “But demand for the drive far outstripped manufacturing capacity, causing skeptics to conclude that little Iomega could never make enough Zips to turn a profit before the big boys' showed up sporting copycat whiskers and claiming the market.” I have heard this mentioned a few times also. People who do NOT understand VTS screaming ‘the copycats are coming'. The copycats do NOT offer the same product. Anybody who has done their homework properly knows this. Ashton Technology Group is 3 years and $15 million dollars ahead of the next likely candidate. CAN YOU SAY SEC APPROVAL? Oh, my, I seem to have missed the part of your impartial analysis where you mention that ASTN spent from the Spring of 1996 to March of 1999 perfecting the system and securing SEC approval. TMFIG foreword continued: “Supporting the bearish view, Iomega was coming off two consecutive years of losses....Some said the stock was going back to $2” Pertinent to both IOM and ASTN and many other stocks....(how about AMZN?) how does a company get it's start if it doesn't have losses in the beginning. Very few companies can make money without spending it first. There are only two more points I want to make about the comparison between IOM and ASTN. First, IOM zoomed from $10 to $30. I think that will prove to be an accurate comparison as ASTN does the same very soon. For IOM, the increase was four years ago. I think IOM is currently trading at about $3. So this is where the comparison ends because IOM is a one product wonder while ASTN has many cards up its sleeve; VTS,eMC, ePLOB, Gomez Advisors, NextExchange, ATG-Canada, etc., etc., etc. You said: “At this juncture it's time to wonder if the stock will be revisiting its penny stock status, or is just catching its breath before the next leg up.” “Trouble is, Ashton has been burning through cash like a scalding knife through butter. It has already burned through $15 million in cash since the spring of 1996.” What, may I ask, did they do with that money? This is an important question. As you stated Fred Rittereiser hasn't taken a penny of salary. Where has the money gone? My personal opinion is that every dollar ATG spent went towards generating future revenue. Would an obviously intelligent businessman like Mr. Rittereiser defer compensation if he wasn't sure it would pay off long term. BTW, wasn't there a recent news article stating that Computer Associates executives took mega bucks out of the pockets of shareholders to compensate themselves? Do you suppose FR might do the same? Do you know how many employees ATG has??? 25 IMHO, ASTN is catching its breath before its next quantum leap forward. Time will tell if my opinion is correct. Logic says intelligent people do not spend three years and millions of dollars to trailblaze a death spiral. In the next paragraph you state your opinion without qualifying it as your opinion: “Each passing day brings tens of thousands of new shares into the market from those early investors who apparently express little conviction for further upside.” I am happy to see that you differentiate between insiders and early investors. However, where is the independent verification of the allegation of ‘tens of thousands' of new shares ‘each passing day'. Also, how do you know that early investors have little conviction for further upside? Have you spoken with any of them? There are numerous reasons why they might register to sell, which have been discussed previously on this board as well as elsewhere. You briefly mention Gomez Advisors, citing a 'decent' presence on the web. Gomez is also mentioned every trading day on CNBC. Gomez is quoted in books on investing. Gomez is spoken of by internet teachers as a place to get high quality ratings on various internet products, not just online brokerages. You once again state your opinion: “Rittereiser declined to release revenue for the unit, but it is likely insubstantial.” I do not know if you are correct or incorrect but you have an obligation to state that it is only your opinion. “Even if Gomez is brought public, it might not make a significant contribution to investors, as recent Internet-related IPOs have flooded the public arena, making one no different from the next.” So, it is your contention that all internet IPOs should be valued the same? It does not matter to investors what products or services the company offers? EDIG and ETYS should have the same valuation because they are both internet stocks? Interesting investment philosophy. You said “The company's balance sheet will need a cash injection fairly soon...” Yes, you are absolutely correct. Luckily for us VTS will launch ‘fairly soon'. At this time next year I fully expect to see IIOnline publicly stating that they were the first to jump on the ASTN bandwagon. -bookish12963- ....Just to add my 2 cents....the warrants have been callable for a few WEEKS now. If ASTN were really suffering a cash crunch, as Lowensteiner says, all they need to do is call the warrants and they get 13 million dollars....almost the same amount they have spent since 1996 to build deploy and obtain SEC approval....that should tide 'em over till July, no?.....what a load of unprofessional CRAP that article was, IMHO....