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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: FMK who wrote (1220)	10/30/1997 8:55:00 AM
From: Paul Dubsky	Read Replies (2) \| Respond to of 27311

Are you adding to your position? It looks like today will be another tough day for the market, so we may be able to pick up more in the low to mid $7s. If it gets there, I'm buying (again). Two things that encourage me are - 1) The great rebound in the share price from $6 to $8, greater than the overall market rebound on Monday. The other stock I've been watching that rebounded much greater than the market on Monday was CheckFree (CKFR), and yesterday, they announced a HUGE deal with Integrion for a 10 year alliance. Stock went from $26 to $30 during the day, which I still think is extremely undervalued given the potential of this deal. But, suffice it to say that they have a great long term future. 2) The deals that VLNC has put together with Alliant and the Military. If Valence wasn't close to mass production, then I wouldn't think that the Military would deal with them. Afterall, the military requirements for procurement are excrutiating. Valence also receives quite a bit of MM coverage, even though there is no one officially covering the stock. This indicates to me that a momentum move is very likely when VLNC announces a deal. Good luck, and again, thanks for your comments.

To: FMK who wrote (1220)	10/31/1997 3:45:00 PM
From: John Curtis	Read Replies (1) \| Respond to of 27311

FMK: I went snuffling around regarding your Red Chip review comment, and yep they made one. Here's a synopsis: The report date is 10/17/97. It starts with a Company Overview entitled: Next Generation Batteries. The summary encompasses pretty much what this thread already knows, however it also states(for the record), "VLNC started shipping samples to potential OEM partners early in the third quarter of 1996 for use in portable PC's and cellular/PCS phones(I believe that 1996 comment is a typo, it should be 1997?). A manufacturing plant in N.I. is being retrofitted and commercial production is expected to start there during the first quarter of calendar 1998. What I find interesting is the following projected income statement: FY98-E FY99-E Revenues(000's) $3,854 $56,469 Gross profit 578 19,500 Gross profit margiin 15% 34.53% SG&A 8,857 9,500 SG&A percent 229.8% 16.82% Operation data I won't go into here Net income(loss) (19,778) $806 Cash flow per share ($0.71) $0.35 etc..... They then go on to discuss current status: Preparing for Commercial Launch, which once again, pretty much mirror's this threads earlier commentary. A parenthetical aside; I've a "warm and fuzzy" over this thread's commentary showing up in such as Red Chip, an evaluation group I've found to be fairly astute. They go on to say, "the conversion of line 1 from a flexible line to a dedicated line for portable PC batteries should be completed in mid-November. This line is running well at low speed today. the line should have production capacity of 2 to 3 Million units. Line two is a high speed line dedicated to cellulr phone batteries with capacity for 7 to 8 million units. The line arrived July 14 and has produced samples for internal testing. It is expected to be ready for testing by potential customers in December. Line 3, identical to line 2, should arrive in November or early December. A 4th line is tentatively scheduled to be delivered in March/April 1998. Their commentary on the above initial estimates states that while revenue estimates prior to production and orders may seem fanciful, their projections are meant primarily to show VLNC's potential for substantial rvenue growth since the market is LIKELY TO CONSUME EVERYTHING THE COMPANY CAN PRODUCE. Total capacity for a production line is based on running three production shifts. They assume sales prices of $20 per unit for portable PC batteries, and $8 each for cellular phones. The revenue assumptions for 4Q98 assume 3 lines in production at 50% utilization and one production shift(very conservative by my thinking, but that's ok). Their industry outlook commentary talks about the portable electronics industry, what it's 1996 batterie consumption was(approx $3 Billion) and how it's project to be around $4 Billion by yr 2000. They believe VLNC has been in extensive discussions with several potential OEM customers that are either looking for an alternative source of supply or looking for a smaller, and more flexible battery design for use. Bottom line? They look for an 18 month target price of $18 based on a 30 multiple of their annualized earnings estimates of 4Q99. They do acknowledge that announcements of production startup and orders could drive the stock to this level much earlier. There's more good data which, if you'd like a copy of the report, you should call 503-241-1265 and asked them to send you a fax copy. It'll set you back about $12.95, and they are prompt about sending it to you. I got mine in 2 hours. Regards! John~