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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Peter Goss who wrote (1441)	1/24/1998 5:26:00 PM
From: Cosmo Daisey	Respond to of 18691

Peter, CUNO:Probably they will take a big charge against earnings this Q. Forward looking is interesting because they were relying in part on Asia to smoothe out the fluctuations in their world wide business and currency exchange rates. Notes in the last annual earnings report show an increase last year in Asia of 20% and Japan of 15% but that was before the Asian problems really came to a head.>>>>>(from 97 report) Our operations in Asia and in Japan, where conditions were especially difficult, reported revenue increases in local currencies for the year of 20 percent and 15 percent, respectively.>>>>> The BOST contract will hurt earnings but its doubtful that the Asian or Japan business will help much this Q and it probably isn't shown in the stock price now. The exchange rate will have an adverse effect because of the devaluing of Asian currencies. (97 Report)>>>"Our gross margin improvement was particularly significant. Since many of our overseas operations import a substantial amount of components and finished product for sale in local currencies from CUNO U.S.,>>> All the items that were positives for the last year have turned negative. It may be possible to wash out bad earnings in one quarter but their worldwide operations with an emphasis on Asia and Japan will probably carry forward for some time. Cosmo