To OTC Journal Members:
 

Trading Alert- Amnis Systems (OTC BB: AMNM)

In the May 7th edition I set the table for today's turn around idea. Amnis Systems popped up on my radar screen as a potential turn around candidate. The situation brought back memories of the fun we had with Calypte Biomed last summer when I first identified that stock as a potential turn around candidate. Loyal readers will recall Calypte was snatched from the jaws of bankruptcy at the 11th hour. The stock had traded down to a mere $.01. Fresh money and new management found its way to viable technology, and the the stock rebounded all the way to $.41 before matters took a turn for the worse.

I have spent a lot of time evaluating the potential of Amnis. The company has technology which is in significant demand in today's safety conscious world, and the customer base of over 4,000 installed systems has remained extremely loyal to the company despite nearly closing their doors in April. There can only be one reason- superior technology. The company must have superior technology. Repeat orders continuing flowing as was disclosed in a press release which came out late today. 

When the first round of financing was announced and a new President stepped in, the stock charged up to $.07 on twenty times normal volume. Since then, the company has been bringing its SEC filings current, bringing employees back to work, and getting orders filled. Today, the dreaded "E" was removed from the symbol indicating the SEC fillings are current, and the company announced new contract flow. In light of all the positive progress, I believe a potential turn around is in the works, and now is the time to jump in. Here's the facts:
 

Amnis Systems- Real Time Video Streaming

Amnis is a pioneer in the technology of delivering video over any kind of broad band network. In a safety and cost conscious world, there has been an explosion of demand for video solutions which mitigate the need for expensive, wasteful, and dangerous travel.

Amnis is widely accepted as having the best real-time video solution available. Applications include remote training and class room environments, video surveillance for security purposes, and remote robotics control.

Amnis systems power virtual classrooms for the University of Hawaii, University of Alaska, Hughes, Pfizer, Daimler Chrysler, and many others. In a highly publicized demonstration, Bell Canada provided a video network over which robotics surgery was remotely performed by a doctor in a different location from the patient. Amnis systems provided the real time video stream over which the surgeon was able to perform the surgery.

Attack drones are remotely flown using Amnis video technology where a real-time video image in mission critical, as with remote robotics surgery. Traffic is monitored from a remote location by the police department in the City of Suzhou, China. There are over 4,000 Amnis systems installed world wide. I am told Amnis has the only system with no latency, meaning the video delivery is in real time with no jerky appearance or delay.

The "many to many"Amnis solution proves a perfect solution for a virtual class room environment. The University of Hawaii uses the Amnis system extensively to create virtual class rooms throughout the Hawaiian islands. I am told the virtual environment is akin to being in the same room. Conversations happen in real time as if the participants were standing next to each other. 

Pictured here are the components of the Amnis network. The broadband connection can be provided in many forms- the internet, intranets, VPNs, T1's, etc. The video quality delivered by the Amnis technology is second to none. If you're wondering- the word "Amnis" is latin for "Streaming".
 

Amnis- The Potential For the Stock

Here's the big picture on the history of Amnis. As you can see, in early 2002 Amnis was a very hot stock. On the heels of major contract announcements, the stock charged from the $.50 level to a high of $1.75. The stock traded nearly 14 million shares in one day. Investors had high hopes for the future as video streaming was identified as a market niche with huge growth potential. 

The company recently completed an additional round of financing for $1 million. A new President has been installed. Former management has been shown the door. Two turn around specialists are now consulting at the company on a full time basis, laying the groundwork for future fiscal growth and health.

Today, Amnis announced two new contracts on the same day the "E" was removed from the symbol. Amnis announced new systems have been purchased by the South Korean military and an undisclosed US Federal Agency.

A more current chart helps set up reasonable expectations for a rebound in the stock. The stock has collapsed from the $.50 level over the past nine months. In light of new management, new capital, new orders, and current SEC filings, I believe the stock is entitled to recoup 50% of the losses experienced in this downtrend, especially if new orders continue to materialize. Therefore, I believe this stock has the potential to rebound into the $.25 range. 

The annual revenue run rate of the company is about $2 million. There are 100 million issued and outstanding, giving the company about a $6 million valuation based on today's trading range.

Taking into account the quality of their technology, the installed customer base of over 4,000 systems, and the high caliber of their clients, I believe the company has significant growth opportunity.

Therefore, here are the parameters for the first trade on Amnis Systems on the strength of a potential turn around in the making:

• Buy AMNM up to $.10. Don't forget to use a limit order.
• Target price over the next 60 days- $.15- although there is potential for a rebound to $.25, a more moderate price target of $.15 is set pending sales getting more traction.
• Stop Loss- $.05- A pullback is highly unlikely, but nevertheless you have to control loss potential. For the high risk end of your portfolio only.

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