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Non-Tech : Turnaround Plays -- Ignore unavailable to you. Want to Upgrade?

To: White Shoes who wrote (174)	1/5/1998 8:29:00 AM
From: David Alan Cook	Read Replies (1) \| Respond to of 206

White Shoes, REF TSSW: I believe TSSW was hurt by tax selling as the stock corrected sharply from its high during the last 6 weeks of the year. TSSW has also not had a profit since the 3rd qtr of 95. Thus, the key question is what are the indicators one could watch to determine when TSSW will show a profit? I have been watching the following: 1) Company's ability to cut costs. * TSSW has reduced costs by about 35% since the 2nd qtr and has reduced its loss from .15 to .09 on lower revenue. 2) Company's ability to grow revenues. * Revenues were down primarily in the 3rd qtr as a result of the company's decision to launch 3 new products during the qtr. Company had to to replace old products such as Checkit version 4 and PC-Cillin 2 with Checkit Version 5, Checkit Pro and PC-Cillin 3. * If the company can reduce its loss on lower revenues then given normal growth and no product replacements in the 4th qtr and the following 1st qtr, I would expect revenues to increase accordingly and the company to show substantial improvements in performace. * TSSW will have a full qtr of PC-Cillin 3 sales for the first time, 6 weeks of Checkit Version 5 sales and 6 weeks of Checkit Pro sales. * 4th qtr is typically stronger than the 3rd qtr in this industry with the following 1st qtr being even stronger. A good balance sheet with lots of cash ( $1.50 ) and no bank debt gives the company " staying power " . Looking for a turnaround in TSSW in 98. Worth watching IMO. DC