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Non-Tech : SPIN-OFFS "secret hiding places of stock market profits" -- Ignore unavailable to you. Want to Upgrade?

To: valueminded who wrote (239)	6/8/1998 1:54:00 PM
From: Stewart Whitman	Read Replies (1) \| Respond to of 1185

Chris, I saw several very negative articles that basically said that the market for Octel's TEL additive is decreasing by somewhere around 7% to 15% per year, that Octel owns about 80% of that worldwide market, and that sales were about $440 million per year (82% of the company's sales), and that there was a lot of price competition in that market. So that and the debt (Debt-to-Equity is ~1.6) account for a lot of the negativity. On the other hand, the stock seems like should earn around $5 - $6 this year (pro-forma, last year's results were ~$6.90), so a P/E of 4 seems rather cheap. I'm not too sure about your longer term targets - given the declining TEL market - but the company has a lot of options. Instead of paying back debt, it could buyback 1/4 of its shares, it could pay a dividend. I tend to agree with your analysis. Thanks for making me take another look. Stew