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Microcap & Penny Stocks : TSIS: WHAT IS GOING ON? -- Ignore unavailable to you. Want to Upgrade?

To: bgavlick who wrote (581)	1/6/1998 10:19:00 PM
From: froland	Read Replies (1) \| Respond to of 6931

All: - Had a long hectic day and wasn't able to call IR until late today. I left a message for Scott and will try again tomorrow. Yesterday when I asked Scott about the number of shares, He gave a string of numbers which I copied down as 18M 6M 3M 3M 9M. He then explained what the numbers were and I wrote down 18M total, 6M inside, 3M Canadian Institution, 3M Swedish Institution, 9M float. Now, 6M + 3M + 3M +9M does not equal 18M. Not being a pro at phone interviews, I decided without asking for a clarification that he must have said 18m total, 6M insider 3M institution and 9M float. 6M + 3M +9M = 18M and I was content. If I find out tomorrow that the numbers are correct, fine. If not, I'm sorry. I'll let this be a lesson not to leave anything to assumption when gathering information which I'll provide to others. I really know better than to do that. As far as todays price action went, it's good to see the sellers stayed away.

To: bgavlick who wrote (581)	1/7/1998 3:48:00 AM
From: Michael T Currie	Respond to of 6931

I wrote this a while back when share sales to the public were still going on, hence the 20MM figure for shares outstanding. If what we have been told is true, we can add another 10% on to the expected profits. I don't know if you can call this risk analysis or not. Possibly more like semi-informed speculation, but here goes - -------------------------------- They are from my own analysis. As one who uses risk analysis on a daily basis (I am a geophysicist working for a major oil company), I like to use at least minimum, most likely, and maximum cases. Clients Rev/Client Net Margins No.Shares Net/Share Min. 10 $0.3MM 20% 30MM $0.02 ML 30 $0.5MM 40% 20MM $0.30 Max. 50 $0.7MM 65% 15MM $1.52 Assumptions: Min. case - Fewer clients than presently signed, net margins much lower than anticipated, additional 50% to the existing shares outstanding ML case - Continue to sign clients at about the same rate as present, net about as high as can be sustained for any length of time, shares outstanding roughly same as present (we think!) Max. case - Accelerate client base through AT&T connection and others, net as high as possible after overhead and taxes, company buys back shares I didn't try to get too fancy with tax loss credits and such. Regardless of whether or not you agree with the individual figures, there appears to be a huge range of possibilities here purely based on the fact that none of us can predict what this company is capable of earning. My enthusiasm for the stock is predominately due to the observation that even in the area not too far above my minimum case, TSIS appears to be undervalued. The upside case is almost frightening . So, lots of speculation, lots of risk, lots of potential. Up until very recently, that's all it was - potential. ---------------------------- I now think that the average revenue per client in all cases is probably too high (per recent announcement that 3 new clients would contribute $60,000 annually) and would probably cut expected profits by 25-50%. None of the cases could possibly be fully accurate. It simply shows that under most profitable scenarios, the present TSIS stock price is too low. bgavlick recently stated that earnings of $0.10 would be equivalent to a P/E of 4-5 and that the industry average is 20. Take a slightly higher earnings projection (say $0.15) but discount the expected P/E due to the BB status (P/E = 12?) and you end up with a $1.80 stock by year end. If and when TSIS becomes a fully reporting company, a higher P/E might be in order. Personally, I think that the 'stigma' attached to BB stocks will diminish as these companies start to report to the SEC on a quarterly basis. After, this is one of the two main reasons that many investors stay away from them (the other being that many institutions cannot or will buy such stocks). Time will tell. Mike P.S. I have just looked at this post. Maybe someone can tell me how to get a table to display properly. It didn't look this way when I entered it!