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AXION INTL HLDGS INC Message Board

  • mairez mairez Jun 4, 1998 10:55 AM Flag

    Very depressed volume this morning

    If the average daily volume is 192K, the stock
    should be moving much more quickly. The is the slowest
    day I've seen for ANLT since I started following (and
    buying) it.

    Is something about to
    happen?

    -mairez

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    • The fact that the academics may say the going
      rate for individuals with GIS/Remote Sensing
      experience is $45K to $50K is strictly their opinion. In
      practice the starting pay is much less with just a
      bachelor degree. I agree that the demand is there but the
      going rate is much less. Visit the GIS Jobs
      Clearinghouse to get a realistic idea of how much companies are
      willing to pay their new employees.

    • Aiiyyiiyiii,

      The bottlenecking effect in
      my opinion is occuring on both
      ends.

      Customers knows the potential as well as the benefits of
      spatial technologies. But in the world of downsizing
      (both private companies and govt sec.) they are
      hesitating but very interested. The last time I attended a
      GIS conferrence, majority of the people attending
      were govt. sponsered and private companies from
      "utility" related business such as cable, power, etc as
      well as real estate and developers. (the academics
      sectors were there too) The responses that I got from
      these attendees....Potential users... were that they
      are have a tough time understanding this "GIS" thing.
      But they see the benefits.
      My opinion..... this
      country has a spatial problem. We have live in a world
      that takes space for granted and now we have
      difficulty understanding space.

      From the ANLT's end,
      I think the Indian purchase answers your question.
      There is a REAL need for geographers or people with gis
      background. Starting pay for such people (undergrad with some
      understanding of gis) was about 45-50K. Students with gis
      experience...easily 60K. The demand for gis personels is greater than
      the supply. One way of finding out is to call your
      local university and find out from the registra which
      dept. teaches the gis courses. Then find out from the
      instructors how popular their classes has been.

      I may
      not have answered your question. But I am trying to
      assure you that overtime, things will work out when the
      technology becomes less pure play... meaning.....when
      everyone start interpreting the infomation on their
      drivers license as a base for geocoding, then people
      understand what gis is all about. In other words, the data
      is already there. People just need to intrepret it
      spatially. when that happens, then gis becomes "mainstream"
      ...ANLT investor makes money. There!
      I still don't
      think I answered your q. Sorry I tried.

    • It's an interesting read, in that it's about 18 months pasttense in general. For instance the description of MSE certainly preceeds it's acq. by ANLT.

      Food for thought.

    • Average EPS growth over last 5 years hase been
      50% not 60%. This reduces the projected best case
      price for the next 12-15 months to 71 from 93. So the
      range resulting from my previous calculations should be
      40-70, not 40-90.

      Sorry for the
      error.

      Mike

    • you wrote:

      there is more than a wild guess
      that we will see additional
      acquisitions. If these
      buys are made with the same care as the two most
      recent ones, ...we should see this stock back over the
      $40 level sometime over the next 12 to 15
      months.

      Internal growth is about 30%. If we extrapolate this 30%
      growth from 3/31/98 to 6/30/99 we obtain 1.19 = 0.86 x
      (1.3)^1.25. For a price of 40, this gives a P/E of
      33.6.

      At present this stock is trading in the high 20's,
      which corresponds to a P/E of ~33 (= 28.5/0.86), right
      about the same. Therefore I suggest that a price of 40
      can be reached in 12-15 months entirely on the
      internal growth rate of 30%.

      Now, if aquisitions
      are added into the picture, one would expect an
      average growth rate higher than 30%. A BEST CASE
      assumption would be that the past record of 60% average EPS
      growth over the past 5 years would be achieved, "if
      these buys are made with the same care as the two most
      recent ones".

      In this case, the EPS for 6/30/99
      would be 1.55. Also, the higher EPS growth rate would
      justify a higher P/E than 33, more like 60, in accordance
      with the 60% growth rate. These assumptions project to
      a price of 93.

      Thus, I would suggest that,
      depending on what actually happens, the price 12-15 months
      out could range from a low of about 40 to a high of
      about 90.

    • I am still seeking confirmation of an opinion
      posted here several weeks ago, to the effect that the
      main bottleneck to working off backlog lies with the
      customers, rather than ANLT's capacity. Anybody?

    • Thanks, TL, for your excellent summary. I think
      your conclusions are right on the money.

      My
      belief is that ANLT can sustain => 25% annual
      internal growth. It is on this basis that I bought the
      shares, and sold when valuation became extreme. I view
      the MSE "acquisition" (merger, really) as exceptional
      (and nicely done). I don't think we can realistically
      count on this kind of highly accretive deal repeating
      consistently. May be one of a kind.

      Also I think ANLT's
      plate is pretty full right now, so it's fine with me if
      they concentrate on what they've got (that's where
      Interra comes in) for now.

      HOWEVER!!
      ...management has made it clear that being a consolidator is
      part of ANLT's core strategy. As GryCrayon notes, they
      can leverage their proprietary software to advantage.
      Bottom line for me is that acquisitions will likely
      continue to juice nice internal growth. While there may or
      may not be more MSE's out there, there is certainly a
      wealth of suspects. Just for fun, here are some
      possibilities:


      http://www.smallworld.co.uk/about/pages/partners_usa.asp

    • ANLT has internal production software which is
      propriatary. Period.

      It's call APS--Analytical
      Production Software. It's been in refinement since the late
      80's. Prior to the acquistions the core business in
      Colorado Springs was doing a little more than $120,000 per
      employee in revenue, which was about double the
      productivity of thier competitors. The acquired business are
      at varying stages of integrating this system and the
      productivity boost at the acquired companies is above
      expectations. Hence the after-tax margin bumps of the last
      year.

      Look for this to continue in both the existing
      business and any additional acquisitions.

    • To Lampest, agree with you on GIS industry, and
      this is clearly the leader with some of their name
      clients, and if you know anymore "dogs" like this, it has
      gone from $4 to $28 in the three years I've owned it,
      please do tell.
      To Visionsphere, wonderful analysis,
      only things if you take out Indian acquisition, there
      have been THREE meaningful acquisitions (not two as
      you state), Intelligraghics, Landmark, and MSE,, and
      also, if you factor in the amount of profitably ANLT
      has brought to these purchases, you're figuring might
      change, do not lose sight of what this mangement can
      do.
      Best.

    • for discussion. There is no question that real
      driving force behind the spectacular price increase in
      ANLT stemmed from from the momentum force initiated by
      the abnormal growth percentages for both sales and
      income which were generated almost entirely by two
      significant acquisitions. This is borne out by reviewing the
      prior five year sales and earnings figures and
      comparing percentages. As time passed and the year to year
      quarterly comparisons gave way to the ability to compare
      sequential quarterly data came about the startling growth
      percentages became just good ones. Exit the momentum player
      and enter the more uninitiated investor/speculator
      who was still looking behind and extrapolating from
      the known data expectations that could no longer be
      supported by the facts.

      Those of us who do try keep
      our emotions under wraps when evaluating a stocks
      worth tend to come off as negative to many who are
      enticed by a hot story or even hotter market action. In
      the end, except for the most nimble short term
      players, we tend not to get into $15 - $20 stocks after
      they have zoomed to the mid fifties and wonder what
      happened when reality sets back in and the stock sells
      back down to the mid twenties.

      There is no
      doubt in my mind that each five point level starting at
      $30 will present a hurdle to be overcome. A simple
      look at any daily chart with volume shows you areas of
      anxious holders, all of whom expected something other
      than to have the stock they bought between $45 and
      $50, or $40 and $45 or $35 and $40, etc. fall to
      $22-23. Included in that group perhaps are those who rode
      the stock all the way up and then took the round
      trip. As the stock rallies, these people now may have a
      different perspective then they did when predictions of,"
      next move $60 or I believe at one time there were some
      posts projecting $100", were bandied about the
      board.

      You surmize correctly that for this stock to
      penetrate those supply zones I have indicated exist without
      backing and filling as each new level is reached, ANLT
      will have to come up with a new set of acquisitions
      which will add dynamic numbers to those already on the
      books.

      As you should know from some of my
      previous posts, I did not become a shareholder until more
      recent times when the stock broke down under $30. I
      started picking up shares at 27 and bought on a scale
      down to $25 3/4. At these levels my judgement tells me
      there is value based on what they have in hand, what
      can be added to by normal business growth and since
      the industry is still fragmented with no one company
      controlling the bulk of the business that's out there, there
      is more than a wild guess that we will see
      additional acquisitions. If these buys are made with the
      same care as the two most recent ones, and please
      don't consider the India one of any serious
      consequence, we should see this stock back over the $40 level
      sometime over the next 12 to 15 months.

      Until and
      unless the stock violates the $24-$25 level on the
      downside, I have to believe that the stock has bottomed out
      and will continue to quietly rebuild a base level
      between $26 and $30 from which to resume a new
      uptrend.

      Hope I did not confuse you.

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