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Non-Tech : LIFEWAY FOODS (LWAY) -- Ignore unavailable to you. Want to Upgrade?

To: Dave Jones who wrote (159)	1/18/1998 1:38:00 AM
From: mark cox	Respond to of 352

Hi Dave I don't get upset when someone disagrees with me about a stock. It is a good balance to have some negativity discussed as well as the positive. In your next to the last sentence you said: " I am not predicting an outright decline in LWAY -- but it won't even come close to a 30 bagger! " You gave no data to back that statement up with other than there could be unforseen difficulties. I hope you noticed that I didn't just come out and make a wild statement about the 30 bagger. I posted my reasons and the data I used to make that prediction. I always mention that everyone should do their own research on this company. The 30 bagger is my opinion, what others predict for LWAY is for their investment decsions. I hope you noticed and appreciated that in all of my posts I never said anything about this company without basing it on some form of fact and I never hyped this company. You'll notice that my estimates for the 2nd and 3rd quarter were quite accurate, in fact I was a little low on the 2nd quarter. It is a possibility that I am very knowledgable about this company and might know a few things about it that some are unaware of because of my intense focus on it. I have studied their financials and crunched the numbers many times over, I have conversed with both LWAY and GGEN on several occasions asking good questions and taking notes which I read periodically. I am on 3 LWAY forums on the internet and carry on correspondence with several LWAY investors with private email. I am ongoing with kefir taste tests which have yielded very favorable results. My doing that kind of research and coming up with a prediction of a 30 bagger based on data that I mentioned with my prediction begs for more than: " However, your claim that LWAY could be a 30 bagger is REDICULOUS!!!!!!!!!!!!!!!!!!!!!! Almost all stocks encounter UNFORSEEN difficulties, and I can almost guarantee you that LWAY will encounter unforseen difficulties. " You said the following: " For example, new factories commonly have glitches, new training costs, ineffeciencies, etc. It is very possible that even if LWAY did see a significant ramp-up in their sales, the new factory will have excessive and unforseen difficulties. I am the voice of practical experience, and let me tell you - it is most inappropriate to be talking about a 30 bagger for LWAY. " Remember that I said the 30 bagger would take 6 or 7 years right? Whatever glitches the 'new' factory might have I would hope have been worked out in the first few months. In fact it has been up and producing product since last October, almost 3 full months now. New training costs? There will be approx. 40 employees when the facility is maxed out. Are you saying that new employees will be sent to a kefir production school? How does on the job training sound? They aren't producing rocket fuel. However kefir can't be too easy to make because both Dannon and Dean Foods both failed at trying to produce and market kefir. So who better to train the troops than probably the most knowledgable kefir man in the country? Mr. Smolyansky. Lastly you mentioned ineffeciencies, this is the one you are most wrong about. The new facility has new automated machines which have been producing more product than the old machines and with less than half the man power. This should really help margins. The places I see that will cut into earnings are depreciation and overhead. As their revenues grow, depreciation will have less and less effect relative to earnings growth. With the 1st phase of the new facility being only 20% of the total capacity, the overhead costs of running the football sized facility as a percentage of revenues will be at its highest now and drop dramaticaly as more and more of the facility is used to produce revenues. I have discussed this company on several occasions over the past 18 months with other investors such as yourself who have told me that LWAY wouldn't do what I have been predicting. In each case it is because they don't fully understand everything about it and how could they unless they spent as much time and effort as I do with LWAY. That is why I only follow a select few companies. Which brings me to your question about my track record. Lifeway Foods +146% American Bingo & Gaming -29% Assisted Living Facilities +132% Lukens Medical -30% (sold) I only own 3 stocks and Lifeway is by far my largest holding. If you will go to the following site you can see how I did in a competion for the year of 1997. Look at OXULL's picks, that's me just like my email oxull. I came in 2nd with an average +91.5% with LWAY, MTY, and WGA home1.gte.net Seeing as how we are talking about LWAY, my other picks don't have anything to do with it, just my track record with it and + 146% isn't too bad. +188% from my lowest purchase price of 3 1/8 I do appreciate the kind words you said about me in the begining of your post. Thank you. I would be more than happy to discuss LWAY with you some more. There have been several people in the past who had disagreed with me and ended up buying LWAY sometime later. I highly suggest calling the company for yourself. Mark

To: Dave Jones who wrote (159)	1/18/1998 2:35:00 AM
From: Steve Cox	Read Replies (1) \| Respond to of 352

Dave, Please explain why it won't even come close to a 30 bagger. You emphasize un forseen difficulties, new factory glitches, new training costs, ineffeciencies etc. What if your unforseeable curve balls don't materialize? What if Mr Smolyansky hits the nail on the head with 15 times new plant capacity from the existing one in 6 years as quoted. That's about $80M in sales. Conservative 11% Net Profit, (LWAY has produced higher even before the new highly automated facility came on line). Shares have a nil chance of major dilution. Wow, $8,800,000 N.I. / 3,800,000 shares = $2.31 earnings X a paltry P/E 50 which it now holds (before the explosive growth which will happen, is happening, in 1998) = $115 sh. The 30 bagger prediction was at $4 sh. so your assumption of a 30 bagger as being REDICULOUS is correct - but I'll take the 28.75 bagger as it works out. Good luck on finding a micro cap with a CEO at the helm who runs a tighter ship than Mike Smolyansky. Have you been in verbal touch with him? I have, and every time I listen to him the story portrayed has materialized. In fact he surprises the heck out of me with the steady progress of LWAY. Crunch the numbers, talk to the man, dream a little. Health food products are hot. Look at the sales and expansion of Whole Foods and Wild Oats. Steve

To: Dave Jones who wrote (159)	1/19/1998 11:37:00 AM
From: mark cox	Read Replies (2) \| Respond to of 352

Hi Dave, I would like to make one more important point. I made the prediction of the 30 bagger on June 24, 1997 at $4.00 a share. Today, 7 months later at $9.00 a share I think it is important to point out that we now only need a 13 bagger in the next 5 1/2 years to make my prediction come true. A 13 bagger in 5 1/2 years, does it still sound ridiculous to you? When I say only a 13 bagger I don't mean it as being something that is generally easy to attain but that it is less than half of my predicted 30 bagger already. Mark