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Microcap & Penny Stocks : DCH Technologies (DCH) -- Ignore unavailable to you. Want to Upgrade?

To: Rickmas who wrote (841)	3/20/1999 4:21:00 PM
From: Scoobah	Respond to of 2513

Rick, there is an article in today's LA Daily News on DCH. I haven't been able to find it on the internet yet, but it is in the business section of the saturday March 20 paper.

To: Rickmas who wrote (841)	3/20/1999 6:05:00 PM
From: Scoobah	Read Replies (1) \| Respond to of 2513

The positive press for DCHT continues, dailynews.com or if it isnt on the front page of the business section when you get to it, go to dailynews.com Engineers follow their noses By Ben Sullivan, Daily News Staff Writer VALENCIA -- Five years ago, over frankfurters and beer at a hot dog stand on Ventura Boulevard, aerospace consultants David Haberman and David Walker decided to take a chance. The pair had learned of a technology developed at Sandia National Laboratory in New Mexico and available for commercialization that used an air-sniffing computer chip to detect hydrogen gas. Believing hydrogen would play a growing role in industry, and that existing sensors were too expensive and bulky to keep pace, Walker and Haberman created DCH Technology Inc. to bring the technology to market. The rest, as they say, is history. Well, not quite. After five years, the Valencia-based company's three standard-bearer products are starting to gain acceptance. But so far, DCH has generated little in the way of sales, with 1998 revenues of $215,000 and a net loss of more than $4 million. The company's stock, which peaked as high $8.25 following its initial public offering in 1996, closed Friday at $1. Still, Walker and Haberman say they are confident of the firm's prospects. "We have no debt, the founders remain in control of the company and our products are quite good," said Haberman, DCH's chairman and vice president of planning. At least a few others agree. James Stock's Stock Tips, a Las Vegas-based investor newsletter, declared the company was "farther along than they've ever been to meeting their corporate goals" and said it may be one of the market's best-kept secrets. At the heart of the DCH game plan is the sensor chip itself. Developed at Sandia, a U.S. Department of Energy research lab, it consists of a thin layer of palladium nickel alloy sandwiched on top of an integrated circuit. When it comes into contact with hydrogen atoms, even at minute levels, the alloy spits protons directly into the integrated circuit's logic cells. Using that same basic technology, DCH has developed a hand-held device for hunting down leaks, a model for installation on hydrogen-powered devices, and a version for use in permanent locales where hydrogen might seep out, such as at a nuclear power plant or waste-treatment center. Together, the three applications have a potential market of $200 million, the company estimates. By outsourcing the manufacturing of the sensors to industrial giant Allied Signal, DCH has managed to keep its staff and capital investments down. The company's staff of 11 consists primarily of engineers working to refine the sensor and develop new applications. Haberman and Walker, meanwhile, have been working to establishing relationships with a bevy of blue chip names they hope will result in 1999 sales of between $3 million and $4 million. A DCH sensor flew aboard a NASA space shuttle mission last year to test the device's extraterrestrial applications. Westinghouse recently certified the technology for use at a Russian nuclear power plant it is retrofitting. And Northrup Grumman Corp. is using DCH products in its metallurgy division. Other customers include Ford Motor Co., Lockheed Martin Defense Systems and the U.S. Naval Medical Research Institute. Still, the fact remains that demand for hydrogen sensors of any sort is limited. While the element is a key ingredient in the fuel cells that environmentalists believe will one day power cars, hydrogen sensor sales currently total in the thousands worldwide, not millions. But if just two or three companies opted to include DCH devices on a broad basis -- say, in every fuel-cell car Ford produces -- it would mean a windfall for the company, Haberman said. With increased sniffing of DCH by investors and customers alike, Haberman said things look positive. "We've been distinctly poor at communications . . . but the neat part is the phone keeps ringing" from potential customers, he said. "It just seems like everything's clicking and coming together."

To: Rickmas who wrote (841)	3/21/1999 8:28:00 AM
From: Scoobah	Read Replies (1) \| Respond to of 2513

Rick, I hope you don't mind, but your post from the Yahoo Ballard thread on the "chasm" sung sweet music to my ears, and helps describe some of that is going on here, to those that are interested, so I am forwarding it to this thread. Book Review: The Gorilla Game - a review of this superb Investor's Guide to Picking Winners in High Technology investingcanada.miningco.com Geoffrey Moore is chairman of The Chasm Group, a marketing consultant to high tech companies like Microsoft, Cisco, Hewlett-Packard and others. Recently named by Upside magazine as one of the "Elite 100 leading the digital revolution" he is the author of two previous books on the high technology industry, Crossing the Chasm and Inside the Tornado. His cohorts on this latest effort are also engaged in the high tech market. Johnson is senior technology analyst with BancAmerica Robertson Stephens, a high tech investment banker, and also an adjunct professor of finance at Columbia University. Kippola is a partner in the Chasm Gorup and a professional investor. He is on the advisory board of Internet Capital Group, a venture capital company. This new book builds on the theories about the high technology marketplace Moore developed in his earlier books. And in case you missed those, because they are so crucial to the game, he recaps them here. The high tech market, argues Moore, is not the same as the regular market. The old rules about investing don't apply here. Today many people are amazed and alarmed at the high valuations placed on stocks in today's stock market. In the high tech market such valuations are common. But Moore says this is not an anomalie, but the nature of this particular beast. The technology market is based on something Moore calls discontinuous innovation. This isn't simply a question of tweaking existing products to make them better. A car is improved by adding electronic fuel injection, better suspension, airbags and so on. But a car is still a car. The innovations are continuous. A discontinuous innovation, by contrast, introduces a whole new paradigm. It means "not compatible with the existing systems". Fuel injection is an innovation. The Ballard Power Cell is a discontinuous innovation as it would require a massive change in infrastructure. It cannot be fully adopted until there is a willingness to change from gas stations to hydrogen supply depots, until there are plants built to generate the hydrogen needed to power millions of vehicles. The people investing in Ballard are betting on Ballard becoming a "gorilla" in Moore's terminology. And if they're right, $10,000 invested in Ballard may well be worth a million dollars in ten years, even though now it is trading at over 1400 price to earnings. So what's a gorilla? Moore et al explain that when a new discontinuous innovation is introduced into the marketplace, there is a recognizable pattern to the market's adoption of the change, what they call the Technology Adoption Life Cycle. First there are several competing companies promoting the technology, each of them offering a variation of the same idea. The technology is first embraced by technology enthusiasts who are willing to pay the higher initial prices. Then the visionaries jump in. These are usually corporate executives looking for ways to give their company a competitive advantage by adopting a new discontinuous innovation. But the mass market has not yet been reached. The mass market is the pragmatists. They don't want to experiment, but they don't want to be left behind. They conform to the herd and when they sense or see the herd adopting a technology, then they jump in too. Between the adoption of new technology by the visionaries and the pragmatists looms the chasm. The chasm is "the consequence of the polar opposition between the visionary, who is deliberately going ahead of the herd, and the pragmatist, who is just as intent on staying with the herd." The chasm is the point at which the visionaries start losing interest but the pragmatists aren't quite ready to jump in yet. You might call it the calm before the storm. And that is because the next phase in the development in a high tech market is the storm, or, as Moore calls it, the tornado. The tornado is the hypergrowth stage of the new high tech market. The herd dynamics that had all the pragmatists holding back at the chasm, now has them leap that chasm and jump in with a vengeance. The tornado phase of the market can generate growth of "300% per year in the very early going, 'slowing down' to 100% a year over a longer period." Gorilla Game website by: Rickmas gorillagame.com