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Strategies & Market Trends : Three Amigos Stock Thread -- Ignore unavailable to you. Want to Upgrade?

To: Dave Baker who wrote (2537)	4/2/1998 11:01:00 AM
From: Sal D	Respond to of 29382

Dave the ATPX story is somewhat confusing with the LUNN merger and all. Sergio has been on top of this one since day one and knows far more about ATPX then I do but I believe his point is thats just it, the low volume is not showing investors are not interested in ATPX its showing they just dont know about them yet, and it wont be long before they do and thats when you will see some action. This is my opinion and Im sure Sergio will give you his thoughts when he gets home. Joe

To: Dave Baker who wrote (2537)	4/2/1998 1:28:00 PM
From: Cary C	Respond to of 29382

ATPX... Dave the volume on this one is kind of scary isn't it. We really feel it is simply a matter of management and the PR firm getting the word out to wallstreet. Which hopefully will happen shortly. Here are some of reasons why we think the company is undervalued more so now than before the 10K 1. From 1996 to 97 current asset increased from 40 million to 60.5 million. Total assets increased from 44.5 to 88.5. 2. granted this is including Lunn's numbers but when you take total liabilities which also include Lunn's numbers. You get 36 million to 58 million. When you divide those by the total assets you get a much better % for97 than you do 96. 47.4% to 23.6 %. Again extremely positive 3. They have increased there working capital 4. Something I personally was not aware of was the renegotiation of their bank loan. Not only did they get a higher line of credit, they also got a better rate. 5. In taking a look at the numbers from the last 4 quarters I notice a trend moving forward not backwards. The growth is there and they haven't even completely got settled in from the merger yet 19. SUMMARY OF QUARTERLY INFORMATION (UNAUDITED) 1997 QUARTERS ------------------------------------------------ FIRST SECOND THIRD FOURTH(A) ------- ------- ------- --------- (IN THOUSANDS, EXCEPT PER SHARE DATA) Net sales................... $23,822 $28,110 $28,608 $ 38,893 Gross profit................ 5,086 6,906 6,742 9,387 Operating income............ 159 2,213 2,253 4,490 Net income (loss)........... (196) 1,049 1,017 2,338 Basic earnings per share.... (b) $0.26 $0.25 $0.48 ======= ======= ======= ========= Diluted earnings per share.. (b) $0.25 $0.24 $0.46 ======= ======= ======= ========= 1996 QUARTERS ------------------------------------------------ FIRST SECOND THIRD FOURTH(C) ------- ------- ------- --------- (IN THOUSANDS, EXCEPT PER SHARE DATA) Net sales............................ $27,048 $30,704 $34,409 $ 34,373 Gross profit......................... 6,447 7,860 8,670 9,192 Operating income..................... 1,223 2,528 3,334 3,326 Income (loss) before extraordinary item............................... 495 1,241 1,752 1,453 Extraordinary loss................... -- -- -- 667 Net income........................... 495 1,241 1,752 786 Basic earnings per share: Income before extraordinary item.......................... $ 0.12 $ 0.31 $ 0.44 $ 0.36 Extraordinary item, net......... -- -- -- (0.17) ------- ------- ------- --------- Net income...................... $ 0.12 $ 0.31 $ 0.44 $ 0.19 ======= ======= ======= ========= Diluted earnings per share: Income before extraordinary item.......................... $ 0.12 $ 0.31 $ 0.42 $ 0.36 Extraordinary item, net......... -- -- -- (0.18) ------- ------- ------- --------- Net income...................... $ 0.12 $ 0.31 $ 0.42 $ 0.18 Finally the company did 119 million in business last year. Here is a part from the 10K in regards to backlog. >>At December 31, 1997, ATP's backlog of orders and long-term contracts was approximately $552 million compared to $283 million at December 31, 1996. The backlog includes scheduled or released orders of approximately $192 million compared to $120 million at December 31, 1996. The backlog includes both firm orders supported by customer purchase orders with fixed delivery dates and blanket orders against which customers issue production releases. The increase in the backlog reflects (i) a change in management's strategy, since acquiring the Brunswick Business in 1995, to obtain longer-term contracts than its predecessor; (ii) improved economic conditions in the aerospace industry; and (iii) the military's commitment to develop systems to combat chemical warfare. << That gives them almost 5 years worth of business already!! Assuming that all of the backlog is filled. Even the scheduled or released orders alone already total 1 1/2 years of work. Hope some of this helps. Anybody have any thoughts? Cary

To: Dave Baker who wrote (2537)	4/2/1998 10:12:00 PM
From: Sergio H	Respond to of 29382

<Buenos dias. According to Yahoo quote, ATPX has an average daily volume of only 10k shares. Aren't you asking for trouble with this one?> Buenas Noches Dave. Earlier this week Hoak and Breedlove reiterated their buy rating on ATPX and put a value on the stock at $19 or over $30% higher than the stock is trading at right now. The earnings released yesterday was full of good reasons for owning this stock, from the backlog of orders to the increasing cash position. Their contracts are usually at least five years in length and since most of their work is govt. related, the contracts are guaranteed. The co. is currently a Nasdaq small cap and an application has been filed for Nasdaq National listing. The listing will be approved, giving this stock more visibility. ATPX will be at an composite industry trade show this month and I am expecting a news release any day now regarding the co. winning a contract to supply Honda with fuel tanks. This is an initial trial contract and is potentially huge. The company has many products that have possibilities to be very successful in the commercial market. The commercial market is an area that this co. is just starting to exploit. In the next few days and weeks, I am expecting a news release about the Honda deal, Nasdaq listing, and perhaps some suprises including new product introduction at the trade show and the possibility of new analyst coverage. The reason for the low vol. is thr low float. The information contained in Yahoo is not entirely correct. The largest shareholder is Equus Funds with somewhere between 40-50% of the shares. The float is really about 2 million shares. I don't believe that Hoak's earning estimates and valuation fully capture the company's potential. There are several cost cutting initiatives that are being undertaken since the merger to improve margin and the commercial products will have more of an impact on the bottom line than Hoak's evaluation takes into concideration. Hoak's earnings estimates call for a 50% growth rate for next year. I do think that this is realistic. I believe that the co. is attracting institutional investors for a secondary offering later this year. The secondary offering will increase the float size and make this stock more liquid and more attractive to institutional investors. This is a stock for investing and not for trading. The short term events should push the stock to 18 near term and later this year, assuming a succesful secondary offering, we can expect the stock to move in line with its anticipated growth. Sergio