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Biotech / Medical : SAFESKIN -- Ignore unavailable to you. Want to Upgrade?

To: Wallace Rivers who wrote (681)	3/12/1999 9:50:00 AM
From: Beltropolis Boy	Read Replies (1) \| Respond to of 828

>I am not long this stock, but I feel for you people and understand the frustration of the rules we play under. The precipitous drop of the stock prior to today smells to me, and, unfortunately, seems to happen a lot. appreciate the empathy, wallace. your comments are echoed by thesteet.com below. obviously, there were fundamental warning signs (cf. melissa wilmoth's oct downgrade) at which most of us scoffed. however, jaffe & co. appeared more than forthcoming. i.e., they presented 'legit' rationales for rising A/R and inventory, especially in light of production transition. furthermore, fourth quarter earnings weren't shabby and jaffe stated that this year was solidly on track. there wasn't evidence -- historically anyway -- to question him. if nothing else, let this be a lesson to me, otherwise, i'm doomed to repeat it. am i naive? whatever happened to street cred? -chris. ----- Why They're Calling It Un-Safeskin By Herb Greenberg Senior Columnist TheStreet.com 03/12/99 06:30 AM ET They're blowing up left and right, and there's a reason: Companies that got aggressive by stuffing the channel with more merchandise than can possibly be absorbed, and/or engaged in aggressive accounting tactics, eventually pay a price. And in each case, investors who smugly ignore the warnings, lulled by the momentum of this stock market, are paying an even bigger price. Which brings us to the disaster of the day: Safeskin (SFSK:Nasdaq), the glove company. This column questioned (http://www.thestreet.com/comment/herbonthestreet/673989.html) whether it was stuffing the channel back in the third quarter. The company insisted it didn't. But in yesterday's press release, explaining why the company will experience a sales and earnings shortfall for the first quarter and the year, CEO Richard Jaffe said: "As Safeskin's distributors were coming off allocation in the third quarter of 1998, we were delivering product into our distribution channels to support an expected rapid increase in sales to meet strong market demand for our products. As it turns out, there was more inventory in the system at that time than we had previously estimated and the ramp up of orders from new contracts took longer than anticipated." Safeskin's stock, which hit a 52-week high of 47 1/8 last year, was at 15 1/4 Thursday before being halted.