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To: ChrisJP who wrote (839)	3/10/1998 9:07:00 AM
From: Novice Bob	Respond to of 2232

Chris: Why can't Magra? It was pointed out to me yesterday that if Magra knew it was going to be positive next Qtr, and Neg. this Qtr., then why not pick up as much expense in this qtr. being already neg. to make next Qtr. even more positive. Sounded like a reasonable argument to me. The first stock I ever owned was NXTL, there was a poster there that went by the name of OJ Didit. He spread the word to all of us how Nextel was doomed to fail. He started his mission at around $9.00 and faded away somewhere around $22.00 per share. The idea that these people have little effect on the stock price I believe is true. OJ had many seemly good arguments, unfortunately for him, Arnie Doolittle made some trips to Nextel's offices and I use to own a business in this field. We (as well as other very knowledgeable participants to that thread) were able to show OJ the holes in every argument he made. We latter learned OJ was shorting Nextel, if you look at a chart from May until July 1997, you can see OJ was not having very good luck. I think we will see strong movements in this stock, but like most penny stocks, you have to deal with the forces of the momentum traders. And the MM's have to build inventory. Many people believe MM's are a righteous group, but they are here to make money (buy low sell high). And they control the price to a great extent (IMO). So once the Momentum traders filter out and the MM's build some inventory, we will head north again. Sure some good news will help as well. Robert

To: ChrisJP who wrote (839)	3/10/1998 12:48:00 PM
From: Psycho Killer	Read Replies (1) \| Respond to of 2232

Chris -- I have been wondering myself why Magra hasn't been making money despite its growth in sales. Guess there are a few possibilities. One possibility is that Magra isn't charging enough, and in effect is winning business from competitors by selling at a loss. In other words, that we are seeing "profitless growth." Another possibility is that Magra's growth has required addition of people and other expense items that has temporarily outstripped sales growth. A third possibility is that Magra has been undisciplined in its growth, and has incurred unnecessary expenses. The "expenses" explanation for why Magra isn't profitable may be plausible, but only up to a point. Magra's "expenses" include wages, and there's no way the company can bring in revenue without paying for the computer people who do the work in the field. Plus, the other expenses such as office space, travel, and telephone seem bound to increase as Magra expands into other countries (a strategy that seems kind of dubious to me). Since Magra had operating losses of $230K in fiscal year 1997 (in addition to $75K in amortization), it would have had to made some pretty large cuts in expenses just to break even. As demand outstrips supply for the type of computer people hired by Magra, one result should be upward pressure on wages. Also, assuming Magra can keep its people, as they get more senior their wages and benefits should increase. Controlling its labor costs and keeping its employees could become a critical part of Magra's mission. Are companies in your industry having any trouble holding onto their employees? -- Jim