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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: Jack Jagernauth who wrote (8477)	9/7/1999 5:07:00 PM
From: JZGalt	Read Replies (1) \| Respond to of 18928

Oops! I kind of got sidelined over the long weekend and forgot to mention a stock I thought might make a good AIM prospect and I didn't think it would go up this much today. Genesis Microchip designs, develops and markets sophisticated, cost-effective digital video/graphic image-manipulation integrated circuit (IC) solutions. The company's ImEngine series of video/graphic-processing ICs represent a breakthrough in full-motion, high-quality video/graphic scaling (shrink and zoom) and de-interlacing technologies. The company initially developed its IC solutions for specialized high-end digital video/graphic prcessing markets - applications such as medical imaging, video editing and television broadcasting. Genesis is a principal supplier to leaders such as In Focus Systems,Inc., CTX Opto Electronics Corp., Texas Instruments and Panasonic. Read this as flat panel displays and high definition television. Fair value $31.68 last time I looked. I bought some last week at $23 1/4. confirmatoryanalysis.com ---- Dave

To: Jack Jagernauth who wrote (8477)	9/8/1999 11:58:00 AM
From: OldAIMGuy	Respond to of 18928

Hi Jack, First of all, I use Value Line's BETA calculation because its consistent. Generally I like BETA's that are above 1.4 in V/L. However, very LOW BETA stocks may be great counter-cyclical stocks for AIM. To confirm VL's estimate of BETA, I then look at the bottom right hand corner of the page for the "Stock Price Stability" rating. This number is best kept below 25. I usually look at debt/equity ratio and like companies generally with low debt. I'm not as specific about this as it all depends on how the company utilizes debt. If it's to build a "monument" to their own glory and to house their staff, then I'm less likely to think they know what they're doing. I like to see Book Value Growth estimates of 15%/year minimum. I like to see Revenue Growth estimates of 15%/year minimum. I like to see significant insider ownership of common stock. (rule of thumb: officers and directors should own one year's worth of salary in stock. ie. Boss makes $500,000/year, he should own at least $500,000 of stock) If a technology stock, I like to see R&D spending at or above the industry average. Above all I like to think I know what's going on in the Macro world of industry and commerce. I want to have the majority of my investments in those areas that seem to have the greatest long term potential relative to that macro analysis. High growth usually means a bumpy road for earnings for smaller cap. companies. This plays directly into AIM's hands. If the company is selling more and building book value, usually earnings will follow - even if not as smoothly. The momentum players will latch onto the stock when the earnings are rising like leach bait. Just as quickly they'll spit the stock out when the earnings "disappoint." These quarterly grunts and groans should be followed, but if the overall business plan of the company remains intact, then AIM will take advantage of the momentum players. I don't know how easily any of this will relate to your database screening efforts, but maybe you'll get some ideas. Usually I can look at a price graph and get a pretty good idea of whether AIM would have done well with a stock. One only needs to look at a utility stock vs a tech stock and see the difference in pattern. But patterns don't tell about the underlying company or the industry it's in. There you need to take a look at the "megatrends" or whatever macro analysis is suitable. Dave gave a good accounting a while ago of the overall telecomm. area and its convergence. I too believe this is only the beginning of a global effort that will go on for a number of years. Sometimes attending a macro economics and investing seminar is a good place to get a feel for these things. I will occasionally visit Madison's University of Wisconsin for such things. It really stirs up the old neurons (plus gives me a chance to exercise my distance vision as I stare shamelessly at the co-eds!!). Maybe I should change my email from Oldcat to Old Goat!! Best regards, Tom