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

To: Pallisard who wrote (7806)	2/4/1999 8:59:00 PM
From: MGV	Read Replies (1) \| Respond to of 27311

Not Company Specific, Industry Specific Wrong again pallisard, pitiful sap!! You've done it again. A racist that repeats mistakes. Imagine that. MIKL has outperformed VLNC from the time of his ignorant statements. For the record, MIKL is less directly affected by the issues affecting Suiza and Dean. Its fundamentals continue to improve as its share price has been held back by misunderstood industry issues. [B] Struggling dairy stocks nearing short-term lows, analysts say By Lyle Niedens, Bridge News Kansas City--Jan 21--Stocks of dairy-related companies, including industry powers Dean Foods and Suiza Foods, could be nearing short-term lows after dropping 2-8% today, analysts said this afternoon. Although retail milk demand has suffered recently amid the highest prices in history, analysts think more buyers will return in coming weeks if milk prices drop as expected. * * * Although Dean Foods and Suiza, the No. 1 and No. 2 milk processors in the US, have enjoyed high wholesale and retail prices in recent months, those prices are in large part a reflection of their rising costs. The basic formula price of raw milk, a measure of prices paid to US dairy farmers, remained at an all-time high in December, rising to $17.34 per hundredweight. That's 30% higher than the previous year and 53% higher than December 1996. Processors can recover much of that cost by raising their wholesale prices. But analysts said retail prices have risen so high that they have erased some consumer demand for milk, thereby reducing demand from retailers for processed milk. "I think we're starting to see some real effect on consumer demand," said Lowell Singer, an analyst with BancBoston Robertson Stephens. "Dean (experienced) a weaker December than anticipated; they are seeing a greater hit on consumption than they expected." Retail purchases of milk across the US fell 4.2% for the 4 weeks ending Dec 6, according to retail tracking firm Information Resources Inc. Meanwhile, the basic formula price rose almost $1 to $16.84. Investors have noticed the resulting squeeze on processors. "We are feeling that pressure today," said David Goldman, an analyst with Montgomery Securities. Shares of Dean Foods, which closed $1 1/2 lower at $36 3/4, have lost one-third of their values since early August. Shares of Suiza, which dropped 7/8 and closed at $39, also have nose-dived since peaking 10 months ago at $67. Those 2 stocks led other dairy issues lower, analysts said. Even though prices for butterfat--the main ingredient in ice cream--have fallen 40-50% since rising to all-time highs last summer, shares of Dreyers Grand Ice Cream dropped 5/8 to $13 1/2 in relatively light trading volume. In addition, shares of egg and cheese distributor Michael Foods dropped $1 7/8 to $22 1/2. Cheese, though, is the reason many analysts think dairy stocks may have finished ebbing and will rebound steadily. More specifically, falling cheese prices during the past week indicate raw milk prices may soon drop, Singer said. Prices for 40-pound blocks of cheese at the Chicago Mercantile Exchange have declined substantially in the last week, falling from $1.60 on Jan 14 to $1.25 today. In fact, cash cheese prices have dropped 34% in the last 12 trading sessions. That freefall likely foreshadows a similar decline in the basic formula price because cheese prices are a leading indicator of future milk values. But David Goldman, an analyst with Montgomery Securities, said Dean and Suiza might not pass all of that price savings along, even though wholesale and retail price trends mirror changes in the basic formula price. "There's no question about it...milk prices are going down," he said. "But there will be some resistance on the part of dairy processors to pass that on through." Instead, Dean and Suiza will probably widen their profit margins by lowering their wholesale prices by a smaller amount than raw milk prices drop. At the same time, analysts said consumers would see some price savings, which should boost demand. As a result, analysts said earnings and share prices of both companies should recover this spring. "We're clearly at the low point," Goldman said, "unless milk prices go up again." Bridge News, Tel: (913) 323-8045 Send comments to Internet address: equity@bridge.com [symbols:US;DF:US;SZA:US;MIKL:US;DRYR] Symbols: US;DF US;DRYR US;MIKL US;SZA Source [B] - BridgeNews Global Markets Categories: MST/GEO/US MST/IND/CNS/BAKE CAP/STOCKS COM/GRAIN COM/SOY COM/LIVE CAP/INDEX