Business Services Industry
TheTruthseeker.com Announces Investment Opinion on K-Tel International
Business Wire, Nov 8, 1999
NEWTON, N.J.--(BUSINESS WIRE)--Nov. 8, 1999--
The Truthseeker.com, initiates coverage on K-Tel International, Inc. ( NASDAQ: KTEL ) with an immediate Sell and Short Sell Recommendation, at any price above 8 dollars. We have placed a price target within the next 2 months of less than 2 dollars per share.
K-Tel recently announced quarterly earnings in a Press Release, claiming in its headline that it "Returns to Profitability." In fact, buried in the text and its financials is the fact that its profits are generated by a one-time-gain of a subsidiary in Finland. Simply adjusting operating results for this transaction, K-Tel actually continued its string of losses, ($700,000 loss) and in fact shows declining revenues. ($18.1M vs $18.8M comparable quarter prior year).
The company is bleeding cash, and despite its claims that it is positioning itself for Internet commerce, its e-commerce revenues are inconsequentially small. A breakout of e-commerce revenues was notably absent from its quarterly report, but its last 10-K reported e-commerce revenues of $400,000 in FY 1999, with losses were $2.2M.
"I think that Arthur Anderson's resignation as KTEL's auditors, which by the way was NEVER mentioned and was quietly slipped past its shareholders in its most recent 8-K filings, speaks louder than any PR the company pumps out in an attempt to keep its stock afloat. This Company is not and will never be a force on the Internet. KTEL has been around over 4 years as an alleged Internet retailer, and now has barely $400,000 in online sales," said Anthony Elgindy, the only analyst listed by Bloomberg as currently covering KTEL.
We assess its valuation generous at 2 dollars and believe nothing has fundamentally changed at the company.
We also advise our readers to go and review the actual class action Law Suit filed against KTEL CASE NO. 98-9327 during the period of October 30, 1998 through November 17, 1998 for further educational purposes. http:// www.wyca.com/complnts/ktelhcom.htm
TheTruthseeker.com is an Interactive Online Magazine and E-mail service site. TheTruthseeker.com issues Truthseeker Reports on a weekly basis. Some of the past reports by The Truthseeker include USATalks.com (NASDAQ: USAT) Citron (NASDAQ: CTRN), NET COMMAND TECH INC (NASDAQ: NCDR), 2TheMart.com (NASDAQ:TMRT), PLAY-BY-PLAY TOYS&NOVELTIES ( NASDAQ: PBYP), PREMIER LASER SYSTEMS'A' (NASDAQ: PLSIA ), AMPLIDYNE INC (NASDAQ: AMPD ), MP3.COM INC NASDAQ: MPPP) ASK JEEVES INC. ( NASDQ: ASKJ) DSL.NET INC, ( NASDQ: DSLN), STAMPS.COM INC (NASDQ: STMP), IVILLAGE INC (NASDQ:IVIL), SUNRISE TECHNOLOGIES INTL ( NASDQ:SNRS) and various others.The Truthseeker.com Reports are sent to our members and often are forwarded on to other the Regulatory bodies. All Truthseeker.com reports are free to members of the public.
To view the most current report please visit our site below or for additional info, please visit us at: http://www.TheTruthseeker.com
TheTruthseeker.com agents, associates, and or employees may or may not have investment positions consistent with the above-stated investment opinion
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