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

To: Scott H. Davis who wrote (157)	1/12/1998 3:22:00 AM
From: HeyRainier	Respond to of 1720

[ Bull Traps ] I've got two: Eagle Hardware and Garden (EAGL) Visio (VSIO) I am favoring the Visio short, as it fits the ideal profile of a Failed Signal. The growth this company has experienced is tremendous, however, and I would like to see how such a signal is dealt with when the Bull Trap is triggered through broad market weakness, rather than weakness that is attributed to the individual issue's shortcomings. Very expensive across the board: - Over 12 times sales - P/E of 56, though projected to grow future earnings by 40%; a P/E of 40 would imply a price of 30, but VSIO has had a history of being able to defy stock market gravity. - Over 50 times Cash Flow - About 16 times book Looks like it has a few shortcomings of its own. Rainier

To: Scott H. Davis who wrote (157)	1/14/1998 3:27:00 AM
From: HeyRainier	Respond to of 1720

[ EQNX] The price action for EQNX is very encouraging... The issue has rebounded and has gained strength. Today's close marks the breakout of a short term downtrend for EQNX. For TA followers, you can trace the downward sloping trendline, which should have the dates 12/3/97 to 12/4/97 and 1/2/98 as the connecting points for the trendline resistance. Other indicators have simultaneously turned up. The number of analysts following this are growing in size, with generally very positive views about the company. Earnings are due out soon, so the true extent of the Asian crisis will make itself evident in the company's numbers, which, I was told, were expected to be minimal to non-existent. Since I wrote my recommendation for EQNX about three weeks ago, the stock has appreciated 14%, while the Dow has fallen 1.5%, for a differential of 15.5%. Not a bad feat considering that The Wall Street Journal just wrote about the "Stealth Bear Market" in small cap issues. All-Star Analysts, here I come. Regards, Rainier