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Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: Anthony@Pacific who wrote (737)	11/17/1998 11:39:00 AM
From: Gerald Walls	Respond to of 19428

It appears that XYBR can't be shorted through ETrade. Can anyone else confirm? I've shorted in this account before: Error: Invalid Sell Short Selling short is not allowed for this ETRADE account or stock symbol. ... Briefing.Com doesn't care much for XYBR: 11:00 ET ****** XYBERNAUT (XYBR) 7 5/16 -9/16 When is a loss of $0.18 a share a whole lot worse than a loss of $0.18 a share a year ago? When the number of shares increases by 50% over the period. Xybernaut reports earnings today, losing nearly $3.5 million on revenues of $259,000, versus revenus of $356,000 a year ago, and losses of $2.2 million. To make matters much worse, the revenue from a year ago includes recognition of $210,000 of revenue from Rockwell Corporation. The Rockwell licensing deal came into play when Xybernaut did not pay $1.4 million to Rockwell for systems supplied by Rockwell. As part of a negotiated settlement, Rockwell was given unlimited rights to Xybernaut's patents, and agreed to pay Xybernaut a licensing fee of $300,000. When Rockwell decided not to get into the wearable computer business, Xybernaut recognized the licensing fee as revenue. In other words, after becoming a licensee of the company's intellectual property, Rockwell gave up on the whole thing. Not very encouraging. A particularly disturbing comment in today's earnings release is the following statement ""The third quarter represented solid revenue growth for the P133 product in spite of limited discounting." If wearable computers are about to be the next rage, and the company is expecting to do $35 million next year, why is "limited discounting" necessary now? If anything, latent demand and limited supply should lead to higher prices. It just doesn't jive with the image of a company that has its hands on the next big wave of computing. Briefing isn't trying to beat up on XYBR; we just think that investors need to view it as it really is: a development stage company for which demand is not yet proven. At a market capitalization of $145 million it is an extremely speculative bet. Briefing advises waiting until real sales actually materialize. In the meantime, expect further dilution. The company had only $814,000 in cash on Sept. 30 and a burn rate of $1 million a month. They sold another 488,343 shares for $1.1 million, ($2.25 a share) in October, but obviously are planning for more. In September, they signed a line of credit agreement with an investor for another 2 million shares, to be issued over twelve months. Next quarter's earnings number may or may not look better than today's $(0.18), but Briefing can guarantee that at least one number will be a lot bigger: shares outstanding.