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Microcap & Penny Stocks : edig (e.Digital ) -- Ignore unavailable to you. Want to Upgrade?

To: JimC1997 who wrote (646)	1/4/2002 7:53:50 PM
From: JimC1997	Read Replies (1) \| Respond to of 1644

Week 1/Year 2002: EDIG vs. NASDAQ With its close this week at 2059.38 the NASDAQ is up 5.6% from its 12/31/2001 level of 1950.40, down 16.6% from its 12/31/00 level of 2470.52 and down 49.4% from its 12/31/99 level of 4069.31. EDIG closed the week at $1.69, up 28.0% from its $1.32 price on 12/31/01, up 0.2% from its $1.6875 price on 12/31/00, and down 41.8% from its $2.9062 price on 12/31/99. EDIG has now outperformed the NASDAQ on all three measurement points for the first week of the new year. And compared to their respective year's low prices on 9/21/01 ($0.73 and 1387.06) EDIG is way ahead, +132% to +48% for the NASDAQ Composite. Just last week EDIG was behind the NASDAQ, but as predicted, it soared well past with a huge gain. Today's gain was 22.7% at its peak (from the previous day's close to the high.) In fact, 15 of the last 16 price EDIG price jumps of 10%+ occurred within eleven trading days of a Friday in which EDIG had underperformed the NASDAQ index. Here is the scorecard since 12/31/00: In 38 of the 53 weeks EDIG has outperformed the NASDAQ Composite index on a year-to-date basis. For the period since 12/31/99, EDIG had outperformed the NASDAQ index in 33 of the 53 weekly comparisons. Actually, EDIG could fall to $1.39 (18%) and still match the NASDAQ index for 2002. Or put another way, the NASDAQ would have to rise to 2497.10 (438 points!) just to catch up to EDIG this year. Some bashers like to point to the decline in price that e.Digital has endured from its 1/24/00 peak and claim that EDIG has performed worse than most tech stocks. But consider this fact: Even after their recent sharp recovery, of the 150 largest technology stocks (by market capitalization at their peaks) 49 (33%!) closed this week at prices which represent more than a 90% decline from their peak value (as did EDIG, of course.) The average decline in value for all of these 150 stocks from their peak price to their 12/31/01 close was 76%. What is the point I am trying to drive home with this weekly comparison? Not that EDIG has been a better investment than holding a diversified group of NASDAQ stocks this year (although that has certainly been true this week!), but rather that EDIG is closely following the fluctuations of the NASDAQ prior to the expected release of good news from the company. EDIG shareholders know that they have a better upside potential than the vast majority of stocks in the NASDAQ Composite and are thus unwilling to sell their shares at these prices. Yes, the NASDAQ will recover over time and will someday surpass its previous highs. But when e.Digital is associated in news stories with the latest and by far the best digital jukebox, marketed by well-known consumer electronics brands, what will happen to the price of EDIG? Could it rise above $4.21? Of course it could, and likely will. But the NASDAQ would have to rise above its old 5132.52 all-time high to keep pace with EDIG shares purchased at this past week's price levels if that happened. Which do you think is more likely to occur first? A rise in the overall market above its old all-time high, or the release of revenue-related news about e.Digital products that could send the stock skyward? For me the answer is clear and that is why I have been purchasing substantial blocks of EDIG at these levels. Stay the course and ignore the rantings of all of the foolish, manic bashers who fester on Raging Bull in lieu of a real life. Their goal is to disrupt the e.Digital investor community which has developed. The "long-bashers" (who hold the stock but whine every day on this board that news hasn't been released to meet their impatient expectations) will be the saddest of all when exciting developments are unveiled, because they failed to heed suggestions to take advantage of a golden opportunity to average down their cost basis at these prices. In Novemeber the company launched the MXP-100, a new IBM MicroDrive-based digital audio player with voice navigation and a new e-commerce site which will sell that product and other e.Digital players as they are released. The MXP-100 has received outstanding reviews both from consumers and from impartial media experts. We then saw a coordinated publicity campaign for that player and the new www.Edigital-Store.com site launched, including the first national television commercial in the company's history. Sales of just 100 units per day will cover all of the company's operating expenses. Fred Falk has also advised all of us in his most recent letters that the list of OEM customers continues to grow and includes some of the best known brands in the consumer electronics world. Recently Circuit City began sales of another e.Digital-powered jukebox under its house label. In rapid succession two other digital audio players using e.Digital technology were launched - the Treo 10 which has received favorable comparisons to the Apple iPOD and the MP2000. We can reasonably expect many positive announcements in the near future, with many more expected in connection with the January CES show where DataPlay is likely to launch a number of e.Digital-powered audio products under a variety of major OEM brands. And e.Digital released the exciting news that it will have a booth at the 2002 CES next week to showcase several new products. Today we got a preview of an announcement in which e.Digital is embarking on an entirely new technology co-venture with Fujitzu in the huge automotive marketplace. Each such product and company development should have a favorable impact on the share price in the weeks ahead. Keep a reasonable perspective on the relative state of your investment here. It is doing just fine, given the condition of the market. JimC