On April 17th Applied Innovation Inc., a provider of network management solutions for telecommunications service providers, reported first quarter 2003 revenue of $5.6 million. Net loss was $2.0 million or 13 cents per share. Revenue was $9.5 million in the 2002 first quarter. The reduction in revenue was significant but was largely due to timing changes in orders from the company's largest international customer. In 2002 the customer placed the majority of it's orders in the first quarter. Since then, the customer has spread it's orders more evenly throughout the year which has resulted in a decrease of $2.6 million in revenue in the 2003 first quarter, so the revenue decline in the first quarter is not as bad as it looks. The company said it expects a healthy sales rebound in the second quarter as orders picked up late in the first quarter as well as pent up demand among it's largest domestic customers.  The company has $24 million in cash and investments which comes out to $1.60 per share. Book value is $2.50 per share. The company has less than $1 million in debt and the stock trades at approximately 1.25x sales.

     Looking at the long-term chart above you can see that AINN has bounced off the low $2 range twice. During the last 10 months the stock has traded in a rather narrow trading range. This range has gotten smaller with each passing month. This chart pattern is likely to resolve to the upside considering that the stock trades just a little over book value. Also, the stock had a similar trading pattern after it made it's low in 1998.

1/14/04 - SOLD AT $7.80 FOR A GAIN OF 133%.