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

To: Sergio H who wrote (6479)	6/27/1998 7:09:00 AM
From: ChrisJP	Respond to of 29382

Hi Sergio, I definitely read your post and considered your advice regarding MTON. But I felt with their revenues and profits doubling this year and analysts estimating profits to triple next year, I thought MTON was a safe long term bet, even if they experienced some contract turn over. Hey, even if their 1999 earnings only double, MTON should do well. You say MTON has a high PE, but I think a PE of 50:1 (now 40:1) when revenues and earnings are doubling is low. I think the PE reflects the concerns you expressed -- namely that some of MTON's contracts are short term. BTW, their remaining contracts expire in 1999 and 2000, so I don't expect another news shock for quite a while. Being undercut does not seem to be the problem as much as the larger companies don't want to outsource their directory assistance. Maybe the loss of Bell Atlantic last year and now Bell South indicates they should think about ways to make outsourcing DA more attractive (i.e. a less expensive service offering). Joe Inti spoke with MTON's IR. Here is a link to his post: Message 5028500 IR is very upbeat regarding MTON's prospects (what a surprise !) but even if we put a filter on it, MTON is still in great shape. They will probably beat the .05 estimate for this quarter and I'm guessing they will still earn .25 for the year. They definitely need to announce some new contracts (which IR claims negotiations are occuring !), but we all know that their is a big difference between being in negotiations and being under contract ! I like Ivan's post regarding stocks that get slammed but then go on to report great earnings. Another example of a similar case is RAIN. It was greatly overvalued, but when it warned, it dropped from 22 to 12 (factoring in their 3 for 2 split). It is starting to weaken now, but after the slam it slowly rebounded back to 16. I thought people who rushed in to buy were nuts, but as it turned out, they weren't. Although MTON had a large percentage drop on Friday, it is trading just 1 point below where it was on Tuesday. Regards, Chris

To: Sergio H who wrote (6479)	6/27/1998 7:21:00 AM
From: ChrisJP	Read Replies (1) \| Respond to of 29382

Hi Sergio, Yes, it is well-know that small caps are underperforming the large caps. I moved into small caps last August because I thought large caps were overvalued and had run their course. I also thought it was time for small caps to shed their "Rodney Dangerfield" image. I was only right about the large caps until Dec. and performance of small caps has definitely been mixed. As long as I'm whining about MTON, I've also noticed that it doesn't take much of an excuse for investors to shed small caps. CADE, RECY, and APCO are good recent examples too. Does anyone question that these 3 companies will do well over time ? I hate to bring up the correlation between APCO and MTON price movement again, but if you look at Thur & Fri's ranges, it's kind of creepy !!! Regards, Chris