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

To: add who wrote (11285)	5/21/1999 7:29:00 PM
From: William Epstein	Respond to of 27311

add; Something is wrong with you browser. Your format is about 24" wide. Your typeface is not Times. Check it out. To answer your question in the case of an expected, blessed event you would see what your seeing now. Accumulation! Then as the announcement of the event drew nearer volume would increase along with money flow, MACD and stochastics would turn up. But there is another indicator that is very reliable. Not only because analysts say so but from my own experience. Insider trading. I checked that today for VLNC using my proprietary research URL and found that all of the insiders did some heavy buying around the end of last year and the beginning of this year. None of them have sold their stock yet. So, they expect something important to happen. We're not talking options here except, Lev Dawson. He got 920,000 shares. All the others bought on the open market. That is very important. Whatever it is, they still have high expectations. It has also been my experience that insiders generally buy about 6mos.-1yr. before the reason becomes apparent. So, we are within that time frame now. They are all wealthy individuals and they can afford to sit on their money for a year but they're businessmen too and one must assume that they all wouldn't have made the commitment unless they had very definite expectations. For bad news it is often the same thing in reverse. However, the sale of insider stock usually takes place about one quarter ahead of the analysts' warnings or downgrades. This is because most businessmen can see how their businesses are shaping up at least, one quarter out beyond the current quarter. So, we can expect something. However, it could be anytime this year. We see that accumulation is still going on in this stock. We just can't fine tune it. PHOTOMAN

To: add who wrote (11285)	5/21/1999 9:07:00 PM
From: Rich Wolf	Read Replies (2) \| Respond to of 27311

add, Based on factory 'readiness,' production in response to a PO could happen at any time. Whenever it arrives, they know it'll be two months or so before they get any money from a stock offering. Let's conservatively estimate their burn rate at $6M/qtr, which is $2M/month. So they need at least $4M to get from when the PO is announced to when they can get $$ from secondary. They can borrow this from Berg, and I'm sure he'd much rather have them go this route than issue dilutive debt. But if they get through June without a PO (someone's dragging their feet), and the coffers are really getting empty, then they know they need at least $4M and maybe more (because the PO arrival would presumably still be uncertain), so better to raise a quarter's worth of cash via debt offering. But then they could still get a PO in July, after issuing debt at end of June, and then start the process for an offering without needing to race the clock. Summary: if they begin (or already have begun?) production towards a PO, and start shipping 4-6 weeks later, they presumably would announce this event ASAP after that 'material event' of booking revenue. If they're only in a negotiation stage, and revenue is more than a quarter away (by means of a secondary), they'll just issue a small debt offering at the last instant they need it (to minimize dilution). But if they're also constantly ordering equipment and raw material, and paying workers, and they knew the offering was more than a quarter away, would they really delay issuing debt to raise a quarter's worth of cash? Or wouldn't we already have seen it? A bullish interpretation of their having been so quiet recently is that something's happening, and they know the timeline (but we do not), and knowing this they can safely just borrow the few millions they need from Berg to serve as a bridging loan, until the offering takes place a few months from now. At the end of June we'll see the financials through the end of March ... which will answer some of these questions, but not the most interesting ones! Those would be, what's gone on during April-May-June? Hmmmm.... now about those PO's ...

To: add who wrote (11285)	5/21/1999 10:43:00 PM
From: add	Read Replies (1) \| Respond to of 27311

Repost of last message for formatting. don't click on the "Use Fixed Font" option it stops word warp. William, Although yesterday I said I expect a announcement of some type by June 15th, now I'm not sure. I ignored my own previous posts about the filing for a possible delay in the effective date for the registration of the secondary offering. The unsubstantiated view is that the delay is in response to the old stockholder suit, by delaying a contract could be announce, the price rises, the secondary is offered, therefore the suit very little merit and can be settled with little cost. If this is the case, then the offering won't come until August , based on the time that the SEC typically takes to approve. Thus, any delay would be past that time. This means that a product announcement would be later in the summer than early in the summer. This is all speculation, the best way to know short of bugging Lev's office is to see what's going on at the factory. It would be worthwhile to pay some NI college student to report everyday over the summer , the number of employees and trucks going in and out of the factory. For a few thousand dollars, you could get a big jump on the rest of the market. I'm seriously thinking about this. I'm not a day trader nor even a weekly trader. I'm just betting on a contract, and somewhat on the timing of the contract through options. I agree with that MMs often have the info before you do, certainly other people who trade on the info do. Here's a question for you in general: Assume some significant event occurs and some people know but its not announced yet. For example a loss of a key contract or in the case of valence, a signing of the first contract. I've often seen that the those that know will dump or buy based on the news in the time between the event and the actual announcement. I've owned stock where the price has dropped 50% over a few weeks without any reason and then the news is announced. I got left holding the bag. I've also seen it go the other way. Do you see any pattern esp. with the volume on such trends ? What do you think is the best strategy in such cases ? If this happens with Valence what would you see happening, given that current volume is around 120K ?