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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: James Strauss who wrote (8754)	12/3/1997 4:57:00 PM
From: Early Out	Read Replies (1) \| Respond to of 79313

KRSL - is this a high tight flag?

To: James Strauss who wrote (8754)	12/3/1997 7:25:00 PM
From: Mark[ox5]	Read Replies (1) \| Respond to of 79313

For the ABTE'ers (and future ABTE'ers): This looks pretty impressive.. Wednesday December 3, 3:17 pm Eastern Time Company Press Release SOURCE: Sterne, Agee & Leach, Inc. Sterne, Agee & Leach Comments on Recent Unsolicited Offer for Able Telecom Holding Corp. ATLANTA, Dec. 3 /PRNewswire/ -- The following was released today by Sterne, Agee & Leach, Inc.: ABLE TELCOM HOLDING CORP. (Nasdaq: ABTE $8-3/8) Price $8-3/8 Price Target (12-Month): $17 52-Week Range: $10-$7 Dividend: $O.00 FY ends 10/31 FY97E' FY96E" FY99E Yield: Nil Q1-January $0.06A $0.11 NA ROE: NM Q2-April $O.09A $0.13 NA Book Value: $1.60 Q3-July $0.10A $0.14 NA Market Cap: $70 mil. Q4-October $0.09 $0.15 NA Shares Outs: 8.4 mil. Full Year $0.34 $0.51 $0.69 Avg. Daily Vol.: 69.305 P/E 24.6x 16.4x 12.1x Total Debt $15.3 mil. 'Excludes accretion for convertible preferred stock "Numbers do not add due to growth of the company's shares outstanding ABTE has received an unsolicited offer from Applied Cellular Technology, Inc. (Nasdaq: ACTC $5-31/32) acquire 100% of the company at a price of $12 in ACTC common shares for each ABTE common share. Based on ABTE's closing price on December 2, 1997, the bid represents a total offer of roughly $100 million. ACTC is a diversified technology holding company with interests in wireless telecommunications infrastructure services, software development tools, and various other businesses. ACTC currently has an annual run rate in revenues of roughly $120 million and 17.7 million common shares outstanding. At current prices, ACTC would have to issue roughly 14-15 million additional common shares to consummate the transaction. We think the news gives visibility to our belief that ABTE has been significantly undervalued in recent periods. Despite today's move upward to the $10-$11 range, we continue to believe ABTE represents a attractive value play on growing global demand for telecommunications infrastructure and network services. We think the company's prospects for internal and external growth provide investors with an attractive play on a rapidly growing and consolidating industry. We hesitate to cheer the proposed combination between ACTC and ABTE because of the potential to substantial dilution of equity and lack of meaningful synergies. We believe ABTE should be trading in the $10-$12 range today based on its stand-alone fundamentals and not simply on takeover speculation. We do not think ABTE is currently for sale and do not expect management to put the company in play until significantly more value has been created for its shareholders. Key features of the ABTE story include: A new era of competition is catalyzing substantial demand for enhanced voice, data, and video telecommunications and increasing the global infrastructure's bandwidth requirements. Under this backdrop, there is a rising need for telecommunications infrastructure and network services. The RBOCs, CLECs, long-distance carriers, and cable TV companies are all seeking to redefine the traditional missions and enter new markets. These entities are increasingly turning to full-service telecommunications infrastructure and network service providers for assistance and support. We believe ABTE is well positioned to capitalize on these trends as a one-stop shop provider of telecommunications solutions. Over the past few years, ABTE has been in a turnaround. The company has redeployed resources, consummated acquisitions, forged partnerships, and revamped its management team. The market for ABTE's services includes numerous small companies that compete for business in limited areas and/or cater to a few customers. ABTE intends to roll-up complementary businesses in this fragmented domain, develop critical mass in the Southeast, and move into new markets in the United States and abroad. ABTE's telecommunications services, cable television services, traffic management services, and communications development groups have complementary strengths but function through stand-alone subsidiaries. The company's communications development group manages joint-venture arrangements throughout Latin America. In FY96, the communications development group began marketing NeuroLAMA, an internally developed proprietary telephone call record and data collection system, to Latin American telephone companies. NeuroLAMA helps telephone companies increase revenues by decreasing fraud, eliminating misoperation and increasing efficiency throughout their analog telecommunications systems. We estimate that roughly 250 million lines worldwide could benefit from the implementation of NeuroLAMA systems, giving the technology a potential market opportunity of hundreds of millions of dollars. We recommend that investors focus on the company's core portfolio of businesses. However, NeuroLAMA could represent the ''grand slam'' of ABTE's story that could allow the company's common stock to trade significantly higher. For example, we estimate that an initial NeuroLAMA contract win of only a few million lines could allow ABTE to generate EPS of more than $1.00 within a period of 12-18 months. Within the next few weeks, we estimate that the company will report 4Q97 (ended October 31, 1997) results that meet our 4Q97 revenues and EPS (before non-cash charges) estimates of $23.2 million and $0.09, respectively. However, the company's recent positive developments, which include significant contract awards from major carriers, cable TV companies, and governmental agencies, lead us to believe that there is upside to our earnings model. Given these circumstances, we are maintaining coverage of ABTE with a ''Strong Buy'' recommendation. Our 12-month price target remains $17, or 25x our FY99 EPS estimate of $0.69.