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Technology Stocks : Zitel-ZITL What's Happening -- Ignore unavailable to you. Want to Upgrade?

To: Michael who wrote (12438)	10/31/1997 3:01:00 PM
From: doug doan	Respond to of 18263

slow down a minute... you are right about the burn rate. Lack of cash is looming large for Zitl. In addition, your calculation of 8 mos. is overly optimistic since it assumes that the burn rate is constant. We know that the losses are accelerating and that the income is dropping. For example, royalties for next quarter are likely to be zero. Earnings from the new companies are a real wild card but if they do not rebound significantly, the next quarter might be the last. My guess is that the present cash will only take them 4 more months. They can sell some more shares to extend it a bit beyond that but it is going to get real hard real quick from here on out. So, with that as background...tell me why Zitl is selling for 14/share? For the last year we have all been following the fundamentals on this stock and have made the same conclusion after each earnings announcement...with little movement in the stock. I can't help thinking that nothing has changed. During that time a variety of longs from the Great Snake, Cubiche, Deep Digm, and now unfortunately Bonnie's Guy have taken the long position very loudly without much thought about the fundamentals. So far they have been right about the valuation of the stock. It really does not matter what the earnings are... Sorry for the long message but things have not yet changed. The lack of cash might be the straw that finally breaks Zitl... Let's calm down a bit and wait and see.

To: Michael who wrote (12438)	11/1/1997 11:59:00 PM
From: Druss	Read Replies (1) \| Respond to of 18263

Michael--I have seen your post and a few others in a similar vein indicated Zitel may soon run out of cash completely. I came up with a few sources of income that I feel might support the company for a while. One is completion of the Nevada contract which presumably would provide some income, the other is the out right sale of their portion of MD. Since it is becoming obvious that no revenues are going to be forth coming from this source an out right sale seems a viable option to me. The sale of MD would however give them a severe problem of timing. For instance selling it now would give them the best possible price but tank their own share value. By waiting to sell, the value of MD would go down but would allow the current over blown share price of Zitel to continue at least for a while. This is of course all speculation but if I were attempting to keep the wolf from my company door I would sure consider it. All the Best Druss