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Technology Stocks : OnSale Inc. -- Ignore unavailable to you. Want to Upgrade?

To: StaggerLee who wrote (906)	3/16/1998 10:16:00 AM
From: Jo_Bidou	Read Replies (1) \| Respond to of 4903

Hi all, I'ved try this morning to short ONSL but my broker was not able to borrow any stock. Since i'm relatively new on this kind of transaction, does it happen frequently that ONSL is not available for short ?? Thank's for your help. Claude

To: StaggerLee who wrote (906)	3/16/1998 9:45:00 PM
From: Mo Chips	Respond to of 4903

Staggerlee, Take a look at ONSL's balance sheet. You will see that at quarter end, they carried VERY LITTLE inventory, about 1/2 months sales. I DID NOT say that the margin has fallen due to shrinkage and obsolescence. I think that their risk is SO LOW, that you have not and will not see these charges to any significant degree. I do have experience with this, however, I also notice the bigger picture when you seem to not. Wouldn't you agree, if you carry very low levels of inventory, and your turns are as high as 2 times a month, that you would see little write-offs. And if there are risks of obsolescence and shrinkage, they should be holding a reserve against the value of the inventory. I'd suspect that they do, and only adjust based on changes in size and age relative to prior periods. If they keep inventory fresh and a low levels, then these reserves should be adjusted only to a small degree each period. I will repeat, margins have fallen primarily due to the change in mix from a consignment to an owned inventory model. GET IT? Mo