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Technology Stocks : ACTM $100 Million Cable Modem Contract with MOT -- Ignore unavailable to you. Want to Upgrade?

To: Rob Preuss who wrote (481)	2/25/1998 5:30:00 PM
From: Joseph Beltran	Respond to of 1250

what happened today smacks of downright INCOMPETENCE. The street will NOT TOLERATE this at all. ALL credibility is gone. I suspect we'll open closer to 10 than 14. Management sounds like a bunch of firestone cops.

To: Rob Preuss who wrote (481)	2/25/1998 5:31:00 PM
From: P.Prazeres	Read Replies (3) \| Respond to of 1250

Rob, You bring up a good point. They did talk about insurability of the inventory....so either they are covered by insurance or they are going to take a charge to write down the missing inventory...if they do take the charge , it's a double wammy, IMO, because the insurance coverage will have been lax and the company pays as the ultimate insurer... whatever the case, though, they have probably destoyed their credibility with the street and that in itself could put this in the doghouse of forgotten treasures. Paulo

To: Rob Preuss who wrote (481)	2/26/1998 2:50:00 AM
From: Gordon Quickstad	Read Replies (2) \| Respond to of 1250

It isn't necessarily going to be a big hit on the earnings announcement. Being's it's inventory, then it will affect assets, but it may be mostly insured. If it's an internal accounting snafu, then they may have to spend more money to replenish inventory that they thought they had and that seems like it would affect the next quarter more than the one being reported. It the shortfall is covered by insurance, then there won't be much effect at all. "Material impact" could just mean that earnings are affected by $0.01 to $0.03 per share. I'll play the guessing game: It'll open $0.50 lower and stay around there, but may be influenced lower if the market takes a dip. If the overall market stays the same or goes higher, I think ACTM will be down for the day due to the uncertainty and will stay modestly down until the earnings are reported, probably within 5 business days. Then I think the earnings won't be as bad as feared. The PE is still significantly lower than the rest of the market and 1998 earnings are projected to be much higher than the trailing earnings which give it about a 16 PE ratio. I think this is why the stock won't get hurt too bad. I'm assuming that the inventory in question is not warehouses full of their most valuable product that got rejected by the OEM who ordered it but got credited as sales by the bean counters.