Newsletter

Profile Archives

OTC Journal Newsletter
November 12, 1998 Volume I, Issue 12
Email : info@otcjournal.com
URL : http://www.otcjournal.com
To OTC Journal Subscribers:
There was great news today on two of our recent profiles, Engineering Power Systems (OTC BB: EGPSF), and AXYN Corporation (OTC BB: AXYN).
First, we will cover the Engineering Power (OTC BB: EGPSF) news release. Yesterday, Taylor Stuart Financial, a Long Island Based brokerage firm instituted coverage with a Strong Buy recommendation on Engineering Power (OTC BB: EGPSF). Their short term target price is $4 to $5, which is about a 300% increase in value from today's levels. In their report they also indicated an expectation of the stock trading as high as $10 per share by June of the Year 2000.
We called Taylor Stuart and spoke with the analyst that put out the Strong Buy recommendation. We asked him what his definition of short term was. His answer: "Six Months".
If you wish to call this brokerage firm and discuss their view on the Company with them, the number is 800-259-0372. Tell the receptionist you are calling about Engineering Power (OTC BB: EGPSF). Here is the complete text of the news release and strong buy recommendation:

Wednesday November 11, 5:00 am Eastern Time
Company Press Release
SOURCE: Taylor Stuart Financial
Taylor Stuart Financial Initiates Coverage in Engineering Power Systems (NASD Bulletin Board "EGPSF") with a Strong Buy Rating
NEW YORK, Nov. 11 /PRNewswire/ -- The following was issued today by Taylor Stuart Financial, a member of the NASD; CRD # 39025.
Strong Buy
Price: $1.78 Range: $4.62 High/$1.00 Low
Stock Symbol: EGPSF COMPANY PROFILE:
EGPSF is a builder, owner and operator of power projects, more specifically barge mounted electrical generating units. We believe this business has the potential to generate several hundred million dollars in revenues over the next 12-24 months. We base this recommendation on the 208 mm contract signed in June 1997 to build 2x100 megawatt barges for the Andrha Pradesh project in India. Construction should begin in early 1999 and be completed beginning of the year 2000. We believe the company is currently working on 500 mm-1 BB of additional power plant business.
HIGHLIGHTS

Just in China alone, the central government wants over 16,000 megawatts a year of new electric generating capacity through the year 2000. The world bank estimates that 380,000 megawatts are needed worldwide through the year 2000.

EGPSF subsidiary, Atlantic Seaboard Industries LTD was founded in 1991, specializing in ship building and offshore oil rig engineering and construction.

In September, 1997, EGPSF retained Everen Securities (one of the country's leading brokerage firms) as its investment banker.

In February, 1998, EGPSF partners with SNC Lavalin, one of the leading engineering, construction and project management firms in the world.

In July, 1998, EGPSF partners with CMS Energy Corporation, the fourth largest U.S. utility company, to form a joint venture to develop, finance, construct, own and operate barge mounted electric generating units throughout the world.

For fiscal year 1999 (ending 6/30/99) we are projecting revenues of approximately 60 to 70 mm US dollars and $.25 to $.35 cents EPS. Therefore, we believe short term EGPSF could trade to the 4 or 5 US dollar level.

EGPSF realizes approximately 15% to the bottom line from the construction of the barge power plants. This translates to an estimated 30 mm US dollars or close to 90 cents per share for the fiscal year 2000 (7/1/99 through 6/30/00). Even the most conservative P/E multiple could translate to a $10 stock by June 2000.

CONCLUSION:
We believe with world wide demand for new power generating capacity growing rapidly, engineering power systems with their joint venture partners (CMS Energy and SNC Lavalin) have created an outstanding international team which could become a major player in the building, owning, and operating of barge mounted power projects. Revenues are estimated to grow from 20 million this year to well over 200 million over the next two years. Earnings are estimated to explode to approximately 70 cents per share to $1.00 per share by the year ending June 2000. These figures do not take into account the additional revenues and earnings EGPSF will realize from the utility sales generated from the very power plants they build.
INVESTMENT SUITABILITY:

For aggressive investors only that are not adverse to the risk inherent to micro investing.

Check with your financial advisor as to blue-sky laws in your state of domicile.

DISCLAIMER
Taylor Stuart Financial in no way guarantees the accuracy of the information provided herein, but has gathered the information from sources believed to be knowledgeable and reliable. Taylor Stuart is a market maker in this security and has an investment banking/consulting relationship with EGPSF. Taylor Stuart may from time to time exercise options granted to Taylor Stuart as a result of the investment banking/consulting relationship. This report is published for informational purposes only and is not to be construed as an offer, nor the solicitation of an offer to sell or buy the security. The information contained herein is based on sources that we believe to be reliable, but Taylor Stuart Financial makes no guarantee or representation about the completeness of the statements or summaries of available data contained herein. This information is provided as of the date of this report and is subject to change without notice. Taylor Stuart Financial' officers, employees, and clients own shares in this security. SOURCE: Taylor Stuart Financial