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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: swisstrader who wrote (59648)	1/10/2000 11:50:00 AM
From: SalmonMan	Respond to of 108040

*NCOG...30 1/2...SSB target $65...Get on it...pounding the table now...from SolomanSmithB: NCOG: Very Positive Meeting with Management Salomon Smith Barney Friday, January 07, 2000 -------------------------------------------------------------------------------- --SUMMARY:--NCO Group, Inc.--Business Services We had an very positive visit yesterday with NCO Group management. * We have a clearer window into progress in Healthcare Services. We believe the problems that caused softness in 4Q99 have been solved. * During 4Q99, the company made several enhancements to its technology. We believe these will improve security and efficiency. * New criteria for acquisitions have been set. In our opinion, purchases of other A/R management companies are unlikely, but other deals may happen. * Improved cost-cutting and salesforce reductions may boost earnings. * Management plans to pay down much its debt over the next few years. * Our strong confidence in management, combined with our belief that the shares should appreciate over 100% for the year, prompted us recently to make NCO Group the top pick in our universe for 2000. -- ---- We visited yesterday with NCO Group management at the company's headquarters, along with a group of institutional investors. Our meeting was very positive, and we feel confident that--as the company enters 2000--it has operations firmly under control and is prepared to continue its solid growth. For over four weeks, the shares have remained well below their peak of $52.88, achieved on November 22, 1999. The drop in price was prompted by a combination of 1) concerns over weakness in the Healthcare Services division, which we address below; and 2) various negative postings on the Internet, which we believe have no reflection on the company's fundamentals. In fact, we have addressed these postings in prior call notes and do not believe they merit further analysis. We remain very bullish on the shares of NCO Group, especially at current levels. It is worth noting that the company has an very solid record of meeting or beating analysts' estimates, and that we continue to believe it will do so despite the temporary softness in Healthcare Services. We are reiterating our 1H (Buy, High Risk) rating, and maintaining our $65 price target.