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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: jean1057 who wrote (4529)	10/25/1998 9:06:00 AM
From: mooter775	Read Replies (2) \| Respond to of 27311

FMK, Paul K, and I among others have made a number of calculations regarding potential contribution for incremental production/assembly lines to NI. I've also heard rumors about increase in throughput from the new version(s) of the Arco lines as well as encouraging speculation regarding pricing. However, until we really get a better feel for pricing and yield models, it is pretty tough to pin down. Last year I calculated the incremental aftertax contribution per line at roughly $ .80 - $ 1.00 per share, and I think that will prove to be the case. I also felt that given the demand for the technology, Vlnc could produce at a 30% pretax margin (Intel's fully-taxed aftertax return on sales is about 30%, as I recall), and with a tax rate at < 20%, Vlnc could have after margins around 20% - 25%. These also continue to seem reasonable. And although I am pretty confident that this time will not prove to be a false start, I'll wait until we really know how many lines are running, etc... before I try to pin down any further numbers. Still long.