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You might take a look at ADSX. Management has been buying up small companies for several years and greatly increasing earnings while EPS went down and the stock with it. Now they have been selling off the items that don't fit the masterplan and earnings are up dramatically -- something like 5500% I recall. The
stock is taking off as a result on greatly increased volume.


Hmmm ... doesn't exactly sound like a compelling story here either, but I give you the benefit of the doubt. I strolled over to Hoovers, and this is what I found about Applied Digital Solutions (ADSX):

"Communications company solutions don't come from chemical mixtures; they come from folks like Applied Digital Solutions. The company (formerly Applied Cellular Technology) generates almost 60% of sales from its telecommunications, network infrastructure, Internet, communications infrastructure, and application technology businesses, which provide integrated communications hardware, software, and services. Its offerings range from network construction and installation to software design and long-distance services. Applied Digital Solutions is taking computer sales and distribution subsidiary public, and divesting operations to build its status as a complete business-to-business services provider."

Telecommunications, internet, business-to-business ... well they got all the hot buzzwords covered. Sounds a bit on the interesting side, so let's take a look at the financials from September 1999 to see if there is something solid behind all the hype:

Annual Sales $350 million (TTM)
Gross Margins 24.3%
Net Margins 0.4%
Cash/Debt ~0.1
Flowie ~1.8

Just for giggles, I took a look at their price chart, and whadda ya know ... this stock was trading at under $5 until early December 1999, which makes it a glorified penny stock. Call me crazy, but again this doesn't sound like a Rule Maker to me. Perhaps you might want to reread our official Rule Maker criteria that we use to determine which stocks are actually worthy of being added to the portfolio. It is available from the following link:

Just my two cents.

the LanceMan
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