S.A. Advisory E-Mail Update
July 17th, 2002
E-mail Alert for July 17th 02 from S. A.Advisory-NEW RECOMMENDATIONS
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MARKET COMMENT FOR JULY 17, 2002
Are we in Hell? The melt down of corporate America has ravaged everyone that
has been invested in the US equity markets. Greenspan in his speech today
should have mentioned the irrational depression that has gripped our financial
markets! The NASDAQ market resembles a "penny-stock" market- not a market
of worldwide leadership within the technology arena. Most tech stocks are 90%-95%
off their 2-year high and some even trade below cash value ( forget the technology that
specific companies sell and market--the market has valued that @ ZERO)!
According to the many new agencies that regurgitate the old news--every company
within our great land has "cooked-the-books"--everything is bad and getting worst!
The Democrats continue to cry foul with respect to every policy and every situation
that develops. GOD forbid ( I hope that I don't offend anyone with the G word)
if the press said something positive..In my opinion, the politically correct, the Democrats
& and the press may very well cause severe harm to our great land and to our
equity marketplace! Our financial and equity structure may not be perfect, but it
has worked in the past and in our opinion can work in the future! We need as a
Country to get POSITIVE!
This recent market melt down has been financially ruining- ie; wcom, mcit and eln
just to name a few-it has been very painful, but we must now look forward and
not be "OTC CHICKEN"! THE WORST TIMES ALWAYS OFFER THE BEST
OPPORTUNITIES--WE JUST WERE A LITTLE EARLY AND DID NOT
FOR SEE THE TRAIN THAT RAN OVER MY HEAD!
WE BELIEVE THAT THIS PORTFOLIO THAT WE ARE FORMING OFFERS
GREAT UPSIDE POTENTIAL LONG TERM AND VERY LIMITED DOWN-
SIDE RISK NEAR TERM. THESE STOCK THAT WE HAVE LISTED HAVE
BEEN RAVAGED!
MELT DOWN MANIA PORTFOLIO FORMED JULY 18TH 2002
WE WILL MONITOR THIS GROUP OF STOCKS FOR % GAIN PER-
FORMANCE.
symbol 52-week range BK cash/sh Debt shares outstanding EPS 02 EPS 03
ditc $2.38-$7.42 $6.27 $3.55 0 30 mil -$1.20 -$.57
eln $1.31-$62.30 $8.76 $4.96 .56 322 mil $1.01 $1.13
lu $1.36-$8.75 $2.94 $1.41 .33 3.4 bil -$.67 -$ .21
pvn $2.00-$59.95 $6.54 $1.34 .46 288 mil $.09 $.64
sanm $5.07-$25.65 $11.61 $1.77 .39 524 mil $.10 $.38
slr $4.80-$19.00 $9.00 $3.41 .66 824 mil -$.12 $.07
vtss $2.29-$23.35 $6.04 $1.20 .37 200 mil -$.41 -$.19
Symbol current price 2- year high short position web-site
DITC $2.74 07/00-$80.00 586K www.ditech.com
ELN $2.40 07/01-$62.00 10.8 MIL www.elan.com
LU $2.70 07/00-$47.00 367 MIL www.lucent.com
PVN $4.05 10/00-$64.00 8.55 MIL www.providian.com
SANM $6.30 09/00-$59.00 17.6 MIL www.sanmina.com
SLR $5.50 11/00-$51.00 51.4 MIL www.solectron.com
VTSS $3.35 10/00-$90.00 2.91 MIL www.vitesse.com
WE CURRENTLY RATE ALL THE ABOVE STOCKS WITH A STRONG BUY
RATING. THE STOCKS LISTED ABOVE SHOULD ALL BE CONSIDERED
RISKY TO A CERTAIN DEGREE!(MAYBE THE REAL RISK IS NOT OWNING
THEM ALL?)
BRIEF SUMMARY OF EACH LISTED STOCK
DITC--A global teleco equipment supplier for voice & optical networks.
The Company's voice products are echo cancellers, which eliminate echo,
a problem in existing and emerging wireline, wireless satellite and voice
networks. See year-end press-release May 29th 02 on-line--very upbeat
and positive---Selling for less than cash value and may even be a take-over
candidate! Great speculation @ $2.74
ELN--Worldwide biopharmaceutical-As of June 10th, 2002 eln reorg. its
business units to focus on three core areas: neurology, pain management
and auto immune diseases. The Company will still operate the Drug Delivery
unit as a stand-alone. Interesting story on eln dated July 9th 02 online-Forbes.com
The press has been terrible on eln and we have been hurt very badly by management
mis-steps. We still believe that @ current levels that eln has been severely over-
sold and investors have ran to exits without thinking logically. NOT sure what
we really have here, but the herd usually is wrong--still earnings have not bee
downgraded--We assume that that is coming soon! We view as a great
speculation --risk does exist..
LU--World leader in global communications, networking industry & designs
and delivers networks for service providers and enterprises. Backed by the
research and development of Bell Labs. Strong buying as of late--Down
95% from 2 year high.
PVN--Issues credit cards and provides revolving credit and deposits
products to customers throughout the US--earnings due July 30th 02.
We recommended pvn a few months ago @ $7.55--ran to almost $9.00
and now @ $4.00--The whole banking sector has been under pressure
like everything else.See complete story on pvn in our April/May 02
newsletter. We remain extremely BULLISH towards this company and
believe that pvn is a takeover candidate @ much higher prices. This
market is just gripped in the FEAR FACTOR!
SANM--Provider of customized integrated electronic manufacturing services.
On July 11th 02 Goldman Sachs initiated positive comments about the LT
potential for Electronics manufactures--Earnings released July 18th 02 after
the close. Off 90% from 2 year high and 75% for the 52-weeks.
SLR--Provides electronic services to original equipment manufacturers that design
and sell networking equipment mobile and land- based teleco equipment computing
and electronic equipment. Same as SANM--mention in Goldman Sachs story.
Down 90%+ from 2 year high and 60%+ from 52 week high. This is high
quality company selling for scraps!
VTSS--Supplier of high performance integrated circuits (ics) principally targeted
at systems manufacturers in the fiber optic communications industry. A takeover
candidate and/or a sleeper stock--out of favor like everything else. Over 95%
down from 2 year high and almost 80% off from 52 week high! I think that I need
to get high! A cutting edge tech stock that has sliced the throat of most investors!
WCOME--AGED ME BY AT LEAST 5 YEARS
yours truly, William Velmer
PS: While diving no time for stock market quotes-only monitoring the sharks!
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