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Strategies & Market Trends : The Rational Analyst -- Ignore unavailable to you. Want to Upgrade?

To: HeyRainier who wrote (65)	12/26/1997 2:05:00 PM
From: Scott H. Davis	Respond to of 1720

[Fundimentally based long term pick] Rainier & All, INVX has even better FA than EQNX, but I would not recommend touching it now. In comparison to EQNX, it has twice the profit margin, better ROA, ROE, Growth/PE, Price/Cash flow, and current ratio. EQNX has a slightly lower PSR, (1.98 vs 2.22) but with half the profit margin I don't find that a relative advantage. EQNX has more cash/share, but also heavy insider selling at least partially offsetting the share buy back. My assessment is the heavy selling is guilt by association with the disk drive industry, since the largest part of their business is selling read/write head wires. But with 70% of the market, they are not subject to the same pricing pressure other suppliers are. Heavy short interest, and terrible TA. On the positive side, their CEO has projected 20% growth next year, while the disk drive makers are guiding analysts to lower returns for their firms. I suspect that once the market psychology changes in regards to the disk drive industry (wait a couple qtrs for positive earnings reports to come in & analyst upgrades), if INVX profitability continues as they project, the short interest could turn into a serious short covering. FYI, Scott

To: HeyRainier who wrote (65)	2/6/1998 1:17:00 AM
From: HeyRainier	Respond to of 1720

[ Equinox Systems (EQNX) ] Based on analyst views of the company's prospects two years ahead, the "fair value" of EQNX has been slightly lowered from my initial 6 to 8 month target of $22.25 for the stock (issued on December 17, 1997). The revised fair value target is now $21 7/8. Technically, the stock has again experienced a Bull Trap in early February trading. Currently recommend a Hold based on TA. By that I really mean a hold, not the Wall Street version of Hold = Sell. Here, Hold means do nothing. Rainier