"""Im Amy Board
Wendy\'s is our consumer-sector favorite
Wendy\'s International, Inc. (NYSE WEN; WSSF Rating: Above average) has moved down lately as hurricanes in the southeastern United States have hurt its profit growth.
We feel investors over-reacted to a temporary situation. It seems they have also overlooked the growing importance of the Tim Hortons donut chain. The Tim Hortons now supplies 27% of Wendy\'s total revenues, and nearly half or its profits.
Thanks to strong sales at Tim Hortons, Wendy\'s total sales in the third quarter of 2004 grew 14.2%, to $741.1 million from $648.9 million a year earlier. However, profits rose just 3.4%, to $0.60 a share from $0.58, due to rising beef costs.
The stock now trades at 14.8 times the $2.23 a share it should make this year. The $0.48 dividend yields 1.5%.
Wendy\'s is a buy."
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THE KONLIN LETTER
5 Water Rd, Rocky Point, NY 11778.
Monthly, 1 year, $95.
Universal Express Inc. has great
Potential and is undervalued
Konrad Kuhn: "Universal Express Inc. (USXP), with its three major subsidiaries, initially built its future on the development of their private postal association, emulating the business model of what FTD did with the floral stores. USXP felt it could offer the same type of services to the private postal stores throughout the U.S., a $6-$8 bil. Industry that lacked continuity and support. USXP\'s Luggage Express (LEx) handles in excess of 9-10 thousand orders a month. They pick up your suitcases at home, hotel, or business and bring them to the end destination, eliminating involvement with luggage when going through airports, renting cars, or while checking into hotels. USXP just announced an agreement with The Ritz Carlton Hotels, who will be using LEx to provide door-to-door luggage service for its guests. USXP also recently signed a contract with Citibank (the credit card division), which has over 500,000 customers-that are given LEx\'s one way service for free as a result of their rewards program. As The Wall Street Journal has said, at the present time LEx is number one in the nation. USXP\'s Capital Division, which offers vehicle leasing and Gift Cards to stores, is very optimistic, with Gift Cards in over 118,000 locations across the country. As they sell, it should show bottom line results.
Most exciting is USXP\'s purchasing 80% of Alpine Airline (OTCBB: ALPE), the third largest air cargo regional airline (based on volume) in the U.S. It operates approx. 23 routes in five states and makes 55-57 round-trips daily. Alpine owns a fleet of 30 airplanes, and currently has an annual sales run rate of about $20 mil. USXP\'s first cargo airline will permit them to utilize Alpine\'s management team to advance the additional five cargo airlines with whom discussions have been ongoing. Alpine has long-term contracts with the U.S.P.S and has seen its cargo volume in the Q3 soar to approx. 5,928 tons, up a dramatic 482% over the same quarter in \'03. Historically, air freight has well outpaced the rate of GDP globally. It is expected to have an annual growth of 6% for the industry, compared with 3% growth for Global GDP.
Furthermore, USXP sold 75% of Universal Express Capital Corp. to Capital Alliance Insurance (Insurance and Funding Company) and will retain 10% of the shares with the remaining 15% of shares being distributed to USXP shareholders (when the company goes public). In addition, USXP received from Capital Alliance a funding lead commitment of $22,000,000 for Alpine Airlines Financing and $225,000,000 for their Equipment Trust Certificates Program.
Revenues for FY \'04 would have been up dramatically if not for USXP reselling both Bags to Go-to reduce its long-term debt and SCI to its former owners due to concern by SCI\'s insurance carriers and clients regarding the recent SEC public complaint filed against the company. Still, for FY \'04 revenues were up 14% to $2.8 mil., with a loss per share of (.01) vs. (.02) for the prior year. Of the 624,964,652 shares outstanding, 2% are held by insiders.
On recent news, the stock had a strong upsurge on increasing volume not seen since mid-last year. The stock needs to break through last year\'s downtrend line and close above .05 for the all-clear signal for a 1st objective of .08. There\'s no doubt, its recent battle with the SEC further differentiates this company from all others. The company is suing the SEC and feels the courts should enforce the judgment that it received ($600,000,000) because they feel that the SEC was responsible for the naked short selling that USXP was victim of. So as acquisitions materialize and strategic funding negotiations continues, and the SEC\'s case runs its normal course, the reality is that this exciting company has great potential and its stock is undervalued. Add/Buy.""""
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