Stratos (STLW) Update

Posted on August 21, 2006

STLW investors should listen to Stratos’s latest earnings conference call, which can be accessed by clicking here.

The call provides a good summary of why we think the stock has low risk at current prices, and significant potential upside should the company report positive earnings sometime over the next 12 months. (Note: The company is already profitable on a cash-flow basis, as can been seen from the recent 10-K).

Notably, the company’s backlog, as of April 2006, was up 20% year-over-year, to $13.7 million. This is the highest backlog in quite some time. In addition, management provided an update on various real estate holdings, which they are in the process of selling. It appears that Steel Partners, who has already offered $7.50 per share for STLW, is pressing management to get a move on with these real estate sales, which could bring in a decent amount of cash to STLW.

STLW reports fiscal first quarter earnings later this month. We’ll be looking for signs of top-line growth, continued cash generation, and progress on various shareholder-value initiatives, including any recent share buybacks given the dip in the stock price.

Please Note: We first recommended STLW at $6.80, and still hold a position in the
stock. All ideas, opinions, and/or forecasts, expressed or implied
herein, are for informational purposes only and should not be construed
as a recommendation to invest, trade, and/or speculate in the markets.
Any investments, trades, and/or speculations made in light of the
ideas, opinions, and/or forecasts, expressed or implied herein, are
committed at your own risk, financial or otherwise.

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This site may include market analysis and we may own shares in the stocks mentioned in our reports. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise.