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Microcap & Penny Stocks : VLVT (was CSMA) -- Ignore unavailable to you. Want to Upgrade?

To: David Smith who wrote (3516)	12/13/1997 9:16:00 PM
From: TraderGreg	Read Replies (1) \| Respond to of 11708

You asked three questions, here are my responses: 1. What is your best guess of the price that you think CSMA will be by Nov. 98 based on everything that you now know? Allowing for five more start up months, and basing the analysis for a revised "current" EPS for a calendar period May98-99 EPS component analysis: AdHatters $.05; EnviroTec(1/2capacity) $.70 ; LPS $.25; COG/other:$.00 (for now and to be conservative) Total EPS(estimated for steady state 12mos of May98-99): $1.00 with a P/E of 15 ====> $15.00 I have reduced AdHatters to reflect lower margins for some of the big accounts. I have increased EnviroTec because I am going well into 1998 before starting my current year of analysis and expect greater throughputs than stated in my post 1984. I have assigned EPS to LPS because it is now far more than just mortgages, with overrides on new financial accounts and a very large potential client base. I have kept COG at 0 because of the correspondingly longer rampup time for that industry. The net of all of this is higher than my 1984 and 1986 post, but you asked for Nov 1998 projections so I get to up the contribution of the components accordingly. 2. What is your minimum predicted price for the previous question with a 95% confidence interval? $5.00--- sh**t happens, what can I tell you.LPS delays, reduced throughput on EnviroTec can be substantial. 3. I guess asking for the maximum predicted price would be out of the question. $20.00 the good stuff can be better but not $15 better, just $5 better. 95 % Confidence Interval becomes ($5.00, $20.00) However, to develop a 95 % CI requires something we ain't got, standard error. To get standard error, we need a sample. But this is but 1 observation. Just trying to estimate the mean price is a SWAG, how could we ever get an estimate on the standard error? Moreover, because this is still a developing company, what one expects to happen, based on projected performance, may be exceeded by a nominal amount. However, to be realistic, one must recognize that a specified shortfall in performance will be far greater to the downside than windfalls will be to the upside. Thus, the lack of symmetry and the $5 to $20 seat of the pants confidence interval. TG