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

To: Sandra who wrote (5436)	5/31/1998 12:22:00 PM
From: Sergio H	Read Replies (3) \| Respond to of 29382

Sandra, ATPX has been slow in getting out of the blocks. There's been nothing but confusion even before the merger. The "reverse split" misunderstanding Filing of numerous revisions of the original S-4 * Press releases on Good Fri. and at mid-night. * Erroneous statistical information on all internet sites, NOT accounting for the merger. * Delay is obtaining National Nasdaq listing and not to mention, confusion with APTX!!!!!!!!!! LOL All in all, the stock has held up pretty well while all this confusion has been played out, but I think that it's time to take a serious look. My post on the ATPX thread: <We are now at a crucial stage for the stock. Here's why: * We should SOON be hearing something about a public offering which will bring much needed liquidity and institutional investing. * Nasdaq National listing is now way, way, way overdue. * Analysts like to see at least three consecutive quarters of solid earnings before initiating coverage. I would be very suprised if we do not see additional coverage at least by Sept. if not sooner. * The Co. is expanding and growing. We can anticipate the opening of Alcore's new facility in Maryland and the anticipated acquisition of a French honeycomb business based on the annual report. * The federal govt.'s fiscal year begins in Oct. and new contracts/work orders are awarded prior to the start of the fiscal year. Perhaps as early as June/July and no later than Sept. ATPX has bids to provide chem defense reckon vehilcles for the U.S. Marines and water purification units for the US Army. * Commercial product development. ATPX's efforts to expand into the commercial arena will bolster this stock in the future. Products ranging from natural gas vehicle tanks to production risers for deep sea rigs to portable jail cells are all in initial stages of commercialization. Sergio

To: Sandra who wrote (5436)	5/31/1998 7:39:00 PM
From: Amigo Mike	Read Replies (1) \| Respond to of 29382

Amigos y Amigas, Here is the article from TheStreet.com FundWatch >>>>>> Fund Watch Features: Roundup: Small-Cap Funds Take It on the Chin By TSC Funds Staff 5/29/98 7:22 PM ET This week was a wake-up call for domestic fund investors who forgot that global tremors can roil U.S. markets. With emerging markets from Russia to Brazil to Asia struggling to keep their economies afloat, investors began to question whether U.S. companies could maintain their earnings growth. The S&P 500 fell 1.5% for the five trading days ended Thursday and domestic diversified equity funds tumbled even further, losing 1.9%, according to Lipper Analytical Services. The selloff was most severe in non-blue-chips. "People are just staying with the most liquid names so if something goes wrong they can get out," says Carl Wilk, portfolio manager of Munder Micro-Cap. "It's a flight to quality, a flight to liquidity, and right now there appears to be no impetus or need to get people back." Indeed, small- and micro-caps were the two worst-performing general equity categories tracked by Lipper. Small-caps lost 2.5% and micro-caps fell 3%. The upshot: The performance gap this year widened between active managers, who tend to look beyond the big companies that make up the S&P 500, and the indexers. The average actively managed domestic diversified fund tracked by Lipper is more than four percentage points behind the S&P 500 funds' 13.6% return year to date. A mere 14% are ahead of the indexers. So what was a small-cap manager doing last week? "Hiding under my desk!" says Rick Lane, portfolio manager of the $20 million FMI Focus fund. Last year, Lane guided his mostly small-cap fund to the top of the mutual fund heap, finishing third among all equity funds, with a 69.7% return. But even before this week -- when it lost 2.4% -- the road's been bumpier for FMI Focus. This year it's up 9.7%. The ride hasn't soured Lane, though. He says there are too many small companies with great earnings and low price tags. "Sooner or later value surfaces." Wilk, of Munder Micro-Cap, agrees. Last year Wilk's bets on tiny companies earned his $52 million fund the No. 2 slot among all equity funds, with a 71.5% return. So far this year that fund is up only 1.7%, having lost 3.4% this week. But, like Lane, Wilk believes solid earnings and low prices among smaller stocks will bring investors back "as we go through the summer and see more weakness in the earnings growth of larger names and smaller names are still strong." Until then Lane and Wilk say they are stocking up on some great buys. Wilk likes: Air Methods (AIRM:Nasdaq), Alpha Industries (AHA:AMEX), Oshap Tech (OSHSF:Nasdaq) and Sapiens International (SPNSF:Nasdaq) . Lane's bulking up on some old favorites like: Superior Telecom (SUT:NYSE), Imax (IMAXF:Nasdaq) and Microtouch Systems (MTSI:Nasdaq). And as a mid-cap play: Covance (CVD:NYSE). <<<<<<<< Obviously, AIRM is gaining attention. now we just need some larger sized funds to jump on the bandwagon. I wish to point out another useful indicator that helps with determining fair value of a stock. The PEG (price-Earnings-growth ratio) is useful in helping to make this determination. A reading of 1 on this ratio means a stock is fairly valued. As a general rule these days, many stocks are valued based on their growth rate. As an example, a stock with a 25% growth rate would deserve a 25 PE ratio (PEG 25/25 = 1 fair value) to be fairly valued. To show you how grossly undervalued AIRM is ..... assume AIRM hits their earnings targets for the next two years and only grows 10% the three years after that. Forward PE (for FY 98) 8.6 1st year (FY 98) 124% growth rate ..... PEG (8.6/124) = ~.07 Yr 2 (FY 99) 40% GR....avg 82% 2 yr GR ... PEG (8.6/82) = ~.104 Yr 3 (fy 00) 10% GR....avg 58% 3 yr GR ... PEG (8.6/58) = ~.148 Yr 4 (fy 01) 10% GR....avg 46% 4 yr GR ... PEG (8.6/46) = ~.187 Yr 5 (fy 02) 10% GR....avg 39% 5 yr GR ... PEG (8.6/39) = ~.22 If you take todays trailing PE of 13.5 and extrapolated the numbers... they read like this: 1 yr PEG (13.5/124) = .1088 2 yr PEG (13.5/82) = .1646 3 yr PEG (13.5/58) = .2327 4 yr PEG (13.5/46) = .2934 5 yr PEG (13.5/39) = .3461 Remember that a ratio of 1 indicates a fair valuation by today' market standards. TALK ABOUT GROSS UNDERVALUATION ..... if I'm not mistaken I think the S&P 500 is somewhere around 3 right now. YIKES. I will patiently wait til the marketplace finds AIRM. Remember that I assumed only a 10 % growth rate the last three years. If AIRM has ZERO growth rate the last three years ..... the 5 yr PEG is still .411 and would have to trade around $10 tomorrow to give a PEG reading around 1. This stock is worth double it's current price !!!!!! Hopefully there will be some play from the TheStreet.com article. Amigo Mike