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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Jeff Bond who wrote (4038)	3/15/1998 3:58:00 AM
From: Quad Sevens	Respond to of 14266

* Off topic * Todd Wiener, Bleeker, anyone: I rarely do this, but you gentlemen have no listed e-mail addresses so I will take this opportunity to introduce you to what appears to be an interesting situation, namely Equinox Systems (EQNX). Company self-description: "Equinox, with headquarters in Sunrise, Florida, designs and markets server-based communications products for remote access, commercial point-of- sale, and industrial automation. These products are available world-wide through leading distributors, systems integrators and VARs. Further information on Equinox is available at equinox.com ". For the financials, we can start with dbc.com which shows no debt, a PE of less than 20, and earnings growth the last two years of over 50%. Top line growth is not as impressive, but was significant in the most recent quarter, and the company just recently announced what appears to be a blockbuster contract with IBM. The latter was enough for a 2 1/2 dollar pop in the share price last week (to 19 5/8). There was some insider selling last fall, but this was also accompanied by large share repurchases in the fall by the company itself. I do not know with certainty what impact the trouble in Asia will have in relation to EQNX's products (My guess: Not too significant). In short, we have a perfect CANSLIM candidate selling at a reasonable PE in the wake of the best announcement the company has ever made (I've been following it a while). Just thought you might be interested. If you have some time, you might want to check it out. I would appreciate your thoughts. Best, Wade

To: Jeff Bond who wrote (4038)	3/15/1998 3:49:00 PM
From: Robert G. Harrell	Read Replies (2) \| Respond to of 14266

Jeff, Jim Collins, CFA, would certainly agree with you. He added THQ to his Growth Stock Winners buy list last month and this month he has it as the featured "Stock Under the Spotlight." He really seems to have a handle on this company and understands the relative and limited importance of the wrestling games. His buy range is between 26 and 32 with a target of 37. Some selected highlights from the article: As one of the leaders in interactive entertainment software for TV-based, PC-based and hand-held systems, THQ... is building an excellent business. It produces computer games that appeal to "middle American" tastes, such as wrestling, bowling and fishing games.... THQ typically develops games based on licenses it receives from popular sports, movies, books, comics and arcade games... The total interactive game software market is estimated at $7.5 billion for 1997, an increase of 29 percent over 1996... ...THQ's current and future efforts are focused on introducing titles for "next-generation" hardware systems such as 32-bit, 64-bit and PC markets. About 50 percent of revenues in 1997 came from sales of next-generation software, compared with only 13 percent in 1996. [Discussion of wrestling games] While its wrestling titles have had the most success, THQ is also known for its numerous licensing agreements with movie studios...Recently it licensed with Viacom to produce games based on the highly popular Nickelodeon show Rugrats. THQ has strong and long-standing relationships with retailers, content providers and console manufacturers. It has been able to secure excellent shelf space in some of the largest retail chains such as Toys 'R'Us, Wal-Mart, Target, Electronics Boutique and Sears. [Discusses product development, Brian Farrel and financials] The rest of 1998 should be lucrative; analysts expect growth of the entertainment software industry to continue. THQ will be leading the pack. The company has 18 to 20 games due for release, which should lead to higher sales volume and higher profit margins. And the company has expanded its international distribution capability, enabling T*HQ to double sales outside of the U.S. Jim Collins has the only news letter I currently subscribe to. He has an excellent track record. He provides a diverse list of 50 stocks which is updated monthly. He seems to have a much better grasp of THQI than most of the pros. Speaking of the pros, it looks like the smart money is relieving the weak hands of their stock during this sell off. On Discover Brokerage Direct's (formerly Lombard) intraday chart, virtually every large block corresponds to a spike up in price. I count 10 bars on Friday's daily histogram and only one seems to match a downturn in the stock price graph. Even though THQI is as large a portion of my portfolio as it is Todd's and I took a hit larger than a year of my old salary, I'm thinking seriously of selling off one of my current losers, probably C-Cube, and putting the money in THQI. This looks like an easy 50% layup by years end and maybe a double. Next week should be interesting. Bob