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Technology Stocks : TAVA Technologies (TAVA-NASDAQ) -- Ignore unavailable to you. Want to Upgrade?

To: Skeptic who wrote (12066)	3/2/1998 3:04:00 PM
From: Jack Zahran	Read Replies (1) \| Respond to of 31646

All of the analysts that cover Tava are giving Y2K earnings a PE of 1 due to their non-recurring nature. Skeptic, I think these analysts are wrong. Why would a P/E of 1 be given to any earnings, the reason is that it is believed that these earnings are one time only, the sale will not generate further business. Is that correct? The Analysts are applying this Y2K earnings rule to TAVA out of context. When it comes to traditional Y2K work most contract providers are basically staffing agencies. Finding a cobol programmer and placing him at the client for the extent of the work. Their revenue is a percentage of the hourly work. When the Y2K work finishes in the office arena, the staffing opportunity goes away. One time revenue. In TAVA's case, their Y2K work adds to their core business. This is the argument that TAVA management is making and they have compelling reasons. For the reason that Y2K work is adding to their client list and causing other Plant work to backlog, TAVA will grow their revenue year to year based on these new opportunities. Too, we can't ignore the outsourcing trend among Manufacturers that is only recently taking place. Other factors include TAVA's capitalizing on the supply-chain needs of the larger manufacturers. Their current Y2K work, is opening a lot of work for them. For the above reasons, I feel (against the prevailing wisdom)that we would be short-sighted to give a P/E of 1 to Y2K earnings for the embedded systems area.