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Non-Tech : Applebee's Neighborhood Grill & Bar (APPB) -- Ignore unavailable to you. Want to Upgrade?

To: Dennis who wrote (52)	4/2/1999 10:41:00 AM
From: Steven Dopp	Read Replies (1) \| Respond to of 71

Dennis (and all others), I found a math error in my Inventories analysis. The correct numbers are posted below: Inventories Y/Y Sequential 12-31-99 $6,709,000 40.1 34.4 9-27-98 $4,992,000 (11.9) (0.7) 6-28-98 $5,025,000 (16.5) 11.3 3-29-98 $4,513,000 (15.8) (5.7) 12-28-97 $4,788,000 5.1 (15.5) Not that the corrected numbers make much of a difference to my analysis, however.

To: Dennis who wrote (52)	4/2/1999 10:58:00 AM
From: Steven Dopp	Respond to of 71

I do not think that APPB is way undervalued, base upon my review of their balance sheet. What I see is a company in trouble. It looks to me like they had to sell their money-losing Rio bravo chain or otherwise they would have lost money this quarter! That may not have been the case but when you look at the mounting accrued expenses, plus borrowing money to buy back stock, you really have to wonder. It may be that the stock buy-back was a smart idea. I don't have enough financial savvy to know. One tell-tale sign would be (at least for me) if management sold a significant number of shares during the stock buyback period (I haven't researched this). I don't know where the company plans to get the money to buy back an additional $50 million worth of shares this year. Perhaps they intend to use the proceeds from the sale of Rio Bravo. I would rather see them use the money to pay off some of their debt. Still, it may be wise to carry a high level of debt at this time, given the current low-interest rate environment. Bottom line, however, is my instincts tell me to avoid this stock (at least for now) based on what I perceive as a weak balance sheet.