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Technology Stocks : Andrea Electronics (AND) -- Ignore unavailable to you. Want to Upgrade?

To: Tully who wrote (1292)	7/28/1998 11:21:00 AM
From: phbolton	Read Replies (1) \| Respond to of 1356

In my opinion they are going bankrupt. The stock should be, at most, about 2 times sales which is about $3-4. PLT is the leader in this business followed by Emkay-Knowles both of which are 10+ times larger than AND. Look at PLT to see how a headset company should be doing- up 40+% over last year, up every quarter (but stock is fully valued IMHO). PLT's growth is much greater than AND's net. There was no MSFT "deal". They paid MSFT for the co-marketing. The IBM deal is apparently losing money as they probably get less than $4/headset as the competition is fierce in the commodity business that the low end is. Inventory is 2 quarter's revenues, receivables is another quarter's revenues. Their "net worth" is about equal to the inventory which is declining in value. Costs are increasing. At current cash burn, with Lamar and Utah, they are heading for chapter 11 in one year. Look for one more "floorless-discounted" secondary before they close the doors. I have been, and remain, very bearish on this one. IF they had had a secondary to raise $10 mil+ a year ago they might have done very well. Instead they enriched the insiders at the expense of the outside shareholders.