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Technology Stocks : ADFLEX SOLUTIONS ( AFLX ) -- Ignore unavailable to you. Want to Upgrade?

To: Douglas V. Fant who wrote (365)	6/3/1998 12:41:00 AM
From: Oleg Sogolov	Read Replies (1) \| Respond to of 718

The official release should have come out already: no warning from the company is good news right now. If indeed, the estimates were cut, then I would worry but only slightly, since we are already sitting on the bottom. Just keep in mind, we have seen drops of 20% on this stock in one day only 6 months ago.

To: Douglas V. Fant who wrote (365)	6/4/1998 6:57:00 PM
From: Kurthend	Read Replies (1) \| Respond to of 718

Doug, I found this on the Yahoo thread. If you are a contrarian, then this is definitely a sign to buy:) I am definitely on the sidelines for now (with all stocks). To many bad things going on in the world today. Take care, Kurt From II's site: After meeting with AdFlex Solutions (NASDAQ: AFLX) management on Tuesday, we decided to lower AFLX shares to sell because of pricing pressures that will make it difficult for the company to keep margins at current levels (gross margins of 21% and operating margins of 9%). On June 2, AFLX made a presentation at the Paine Webber Technology conference. Don Frederick, CFO of Adflex Technology, said that the company also expects softness in all of its market segments, including computers and communications, which will likely result in flat sequential revenue and earnings growth during the next two quarters. In terms of Hard Disk Drive (HDD) market, Frederick isn't looking for it to rebound. Another negative point that made us change our investment opinion is that AFLX continues to be cash flow negative due to huge spending on capital equipment and R&D. While we were meeting with management (literally), AFLX shares were down more than 3 points. A recent quote was $12.38. We are lowering our second quarter forecast, ending June, and estimates for FY1998 and FY1999 due to margin pressure that will hurt the bottom line. Our second quarter earnings estimate came down to $0.31 per share from our previous estimate of $0.35 per share, which is only a penny above the most recent quarter. Assuming gross margins of 20% and operating margins of 8%, we think AFLX will earn $1.34 per share this year, down from our previous estimate of $1.50 per share, and expect the company to earn $1.80 per share in 1999, down from $1.90 per share. We think that AFLX is a sell at this time, despite the company's continuing diversification strategy and cost savings at its Thailand manufacturing facility. Updated 6/4/98 with AFLX at $12.38. Recommended 11/18/97 at $20.38. Clearly, what II is worried about is that this co. is currently cash flow negative and has a current ratio <2:1.,and is not looking at it as a value stock. The dilemma that AFLX is in is that they need to do a secondary offering, but at this price the stock is going to get killed. Good luck with this one...I would stay far,far away.