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Technology Stocks : Zitel-ZITL What's Happening -- Ignore unavailable to you. Want to Upgrade?

To: g forrest who wrote (17304)	10/21/1998 10:50:00 AM
From: Marconi	Read Replies (1) \| Respond to of 18263

Hello G. Forrest: ZITL tends to move in capricious patterns at times. I believe there will be a spell of elevation in price--possibly some short covering. $1 variation means little to someone whose profit margin is more than 95% intact. Tax avoidance or offsetting losses that many more people are reporting now, is likely part of the recent week's trading. In recent days, there have also been some relatively big chunks moved earlier in the day and then toward the close at the same price...some of the major volume on some days appears to be synthetic. The fundamentals are more dismal now than before the combination. Atrocious fundamentals, limited cash, high cash burn, declining volume are generally indicators of a stock that will continue to experience price erosion. For tax purposes, there is an advantage to keeping this entity alive, but desire for viability does not keep an issue in the market. I think watching estimates of cash and costs are the clearest view of the position of the entity. The revenues are a much more evasive number, but have been minor fractions of costs to date. The peak activity for y2k was to be this year. There remains the issue of procrastination, which I do not believe is going to be the windfall hypsters make it out to be. It will be based on labor availability, and the MD-Zitel entity is an insignificant source of labor relative to the many other firms with many legions of personnel. I remain short. Maybe the day traders will get a chance to short, but it looks pretty doubtful to me. The stock will continue to languish until material news allows a more accurate peg of valuation than present. Best regards, m