STOCKREPORTS		 JTS Corporation ASE Symbol JTS
19-JUL-97 Industry:
Computers (Hardware)		 Summary: JTS designs, makes and supplies capacity-enhanced hard disk drives for the notebook and desktop personal computer markets.

Recent Price 0.88
52 Wk Range 5.50 - 0.44		 Yield Nil
12-Mo. P/E NM

Quantitative Evaluation:
Outlook (1 Lowest - 5 Highest)
NA
Fair Value
NA
Risk
HIGH
Earn/Div Rank
C
Technical Evaluation:
NA since NA
Rel. Strength Rank (1 Lowest - 99 Highest)
1
Insider Activity
NA

Business Profile 30-MAY-97

In May 1997, JTS secured a $30 million working capital line of credit and a $25 million foreign accounts receivable line of credit. The lending arrangements are intended to provide JTS with additional capital to expand production and ramp up the new high performance Champion Family of 3.5-inch disk drives for the desktop market and the Nordic Family of 3.0-inch disk drives for the notebook market. In April 1997, JTS delivered its first shipment of 3.0-inch Nordic disk drives to a leading European notebook OEM and completed its first shipments of new high performance 3.5-inch Champion disk drives late in the first quarter of FY 98 (Jan.).

Operation Review 30-MAY-97

Based on a preliminary report, net sales totalled $73.4 million for the three months ended May 4, 1997, and the net loss totalled $11.8 million ($0.11 a share). Results are not comparable with the three months ended March 31, 1996, as they include only the operations of Atari Corp., acquired by JTS in July 1996. JTS noted that revenue levels in the first quarter of FY 98 (Jan.) were impacted by a sales shortfall of the 3.5-inch disk drive products while it transitioned from its old line of drives to its new high performance Champion drives. During the FY 98 first quarter, JTS was able to increase its product yields and lower product costs, while reducing operating expenses by 15% as compared to the fourth quarter of FY 97.

Stock Performance 18-JUL-97n

In the past 30 trading days, JTS's shares have declined 33%, compared to a 7% rise in the S&P 500. Average trading volume for the past five days was 412,220 shares, compared with the 40-day moving average of 769,737 shares.

Key Stock Statistics

Dividend Rate/Share Nil
Shs. outstg. (M) 112.9
Avg. daily vol. (M) 1.136
Tang. Bk. Value/Share NM
Beta 1.80
Shareholders 2,800
Market cap. (B) $0.099
Inst. holdings 2%
Value of $10,000 invested 5 years ago:$ 5,833

Fiscal Year Ending Jan. 31

Revenue (Million $)
1998 1997 1996 1995 1994 1993
Q1 73.41 NA 4.87 8.16 10.15 44.10
Q2 NA NA 3.02 8.19 5.72 23.30
Q3 NA NA 4.06 7.17 4.41 34.50
Q4 NA NA 2.80 14.92 8.53 25.65
Year NA 90.53 14.63 38.44 28.81 127.3

Earning Per Share ($)
1998 1997 1996 1995 1994 1993
Q1 -0.11 NA -0.07 -0.02 -0.03 -0.24
Q2 NA NA -0.06 -0.06 -0.12 -0.69
Q3 NA NA -0.21 -0.07 -0.31 0.03
Q4 NA NA -0.44 0.30 -0.39 -0.54
Year NA -1.81 -0.79 0.16 -0.85 -1.44

Dividend Data: No cash dividends have been paid.

Business Summary 30-MAY-97

JTS Corporation (JTS) designs, develops, manufactures, and markets enhanced capacity hard disk drives for the notebook and desktop computer markets, offering a line of of ultra slim 3.0 inch disk drives, which the company states provide higher capacity and lower cost per megabyte than competitive alternatives in the personal computer market.

Since its inception in 1994, JTS has incurred significant losses which have resulted from the substantial costs associated with the design and development of its products, the establishment of manufacturing operations, the development of a supplier base, and the marketing of its new products and the ramp up of production volumes.

JTS has developed three product familes of hard disk drives: the Nordic product family for notebook computers, which includes disk drives with 3.0 inch form factors and two or three recording disks; the Champion product family of high capacity 3.5 inch drives for performance desktop computers; and the Champ product family of high capacity 3.5 inch drives for entry-level desktop computers

All JTS hard disk drives are encapsulated to protect against handling, shield from electro static discharge damage, improve reliability and provide easier installation. This feature also reduces electromagnetic radiation interference to and from the unit.

JTS markets and sells its products to original equipment manufacturers (OEMs) for incorporation into their notebook and desktop computer systems and subsystems.

The company's strategy for becoming a leading supplier of hard disk drives to the notebook and desktop computer markets includes: establishing 3.0 inch form factor technology for notebook computers; developing innovative disk drives for desktop personal computers; achieving a low product cost structure; and forming strategic alliances with key participants in the computer industry.

In July 1996, JTS acquired Atari Corp. which manufactures and markets interactive multimedia entertainment systems and related software and peripheral products. Prior to the merger, Atari's business had been downsized considerably and the company noted that it will not be a significant part of its operations in the future.

Important Developments

Mar. '97 JTS announced the availability of Champion family 3.5 inch Fast ATA-3 hard disk drives with capacities of 3.0 gigabytes (GB), 2.5 GB, 2.0 GB and 1.7 GB. Targeted toward the Pentium-based desktop PC market, the drives are MMX ready, offering the capacity, speed and sustained data flow needed to support full-screen, full-motion video for multimedia applications.

Capitalization

Long Term Obligations: $54,365,000 (5/4/97).
Conv. Pfd.: 35,807 shares.

Per Share Data ($)
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
Tangible Bk. Val. 0.12 0.40 1.05 0.08 0.89 2.18 1.75 1.49 1.44 2.68
Cash Flow -1.66 -0.76 0.22 -0.85 -1.39 0.45 -0.28 0.11 0.72 0.84
Earnings -1.81 -0.79 0.16 -0.86 -1.29 0.41 -0.36 0.07 0.68 0.76
Dividends Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil
Payout Ratio Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil
Cal. Yrs. 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
Prices - High 9 1/8 4 3/8 8 1/8 12 3/4 3 3 3/8 9 3/4 12 3/4 9 1/8 16 1/8
- Low 1 3/8 1 1/8 2 7/8 1/2 1 1/16 1 3/8 1 1/2 4 3/4 4 7/8 4 7/8
P/E Ratio - High NM NM 51 NM NM NM NM NM 13 21
- Low NM NM 18 NM NM NM NM NM 7 6

Income Statement Analysis (Million $)
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
Revs. 90.5 15.0 38.0 29.0 127 258 411 424 452 493
Oper. Inc. -136 -51.7 -20.6 -34.7 -59.2 -16.2 -20.5 6.2 61.7 70.0
Depr. 12.7 2.0 3.4 0.4 2.8 2.5 4.7 2.5 2.1 4.4
Int. Exp. 3.5 2.3 2.3 2.3 3.5 4.3 6.6 6.3 4.8 5.2
Pretax Inc. -151 -50.2 9.4 -49.1 -83.2 23.6 -19.4 2.5 58.5 74.8
Eff. Tax Rate Nil NM Nil NM NM NM NM NM 33% 41%
Net Inc. -151 -50.2 9.4 -48.9 -82.7 23.7 -20.8 4.0 39.4 44.2

Balance Sheet & Other Fin. Data (Million $)
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
Cash 24.8 51.0 81.0 31.0 49.0 70.0 37.0 55.0 92.0 103
Curr. Assets 66.3 65.0 113 51.0 110 239 254 307 324 406
Total Assets 131 78.0 131 75.0 139 253 273 331 338 518
Curr. Liab. 65.2 10.0 21.0 17.0 34.0 79.0 122 167 180 217
LT Debt 53.1 42.0 43.0 53.0 54.0 48.0 49.0 77.0 75.0 133
Common Eqty. 12.4 25.0 67.0 4.0 51.0 126 101 86.0 83.0 168
Total Cap. 65.5 68.0 111 57.0 105 174 150 163 158 301
Cap. Exp. 16.2 0.8 1.2 0.7 3.2 2.1 4.0 5.6 2.5 4.1
Cash Flow -139 -48.2 12.8 -48.5 -79.9 26.2 -16.1 6.5 41.5 48.5

Curr. Ratio 1.0 6.5 5.5 2.9 3.2 3.0 2.1 1.8 1.8 1.9
% LT Debt of Cap. 81.1 61.8 39.3 92.4 51.6 27.9 32.6 47.4 47.4 44.3
% Net Inc.of Revs. NM NM 24.4 NM NM 9.2 NM 0.9 8.7 9.0
% Ret. on Assets NM NM 8.8 NM NM 9.0 NM 1.2 9.2 12.6
% Ret. on Equity NM NM 26.1 NM NM 20.9 NM 4.7 31.4 32.4

Data as orig. reptd.; bef. results of disc. opers. and/or spec. items. Per share data adj. for stk. divs. as of ex-div. date. E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked.

Office--166 Baypointe Parkway, San Jose, CA 95134. Tel--(408) 468-1800. Fax.--(408) 468-1619. Chrmn--S. L. Tandon. Pres & CEO--D. T. Mitchell. Exec VP-CFO & Secy--W. Virginia Walker. Dirs--A. L. Azan, J. D. Deleage, R. W. Johnson, D. T. Mitchell, L. B. Tan, S. L. Tandon. Transfer Agent & Registrar--Registrar and Transfer Co., Cranford, NJ. Incorporated--in Delaware in 1994. Empl-- 6,500. S&P Analyst: M.I.


This report is for information purposes and should not be considered a solicitation to buy or sell any security. Neither S&P nor any other party guarantee its accuracy or make warranties regarding results from its usage. Redistribution is prohibited without written permission. Copyright © 1997