According to the SmallCaps report, the results of AMBI's fiscal first quarter (ended September 30, 1998) combined with management's discussion of results on a recent investor conference call, have prompted the SmallCaps analysts to raise their cash flow and net income forecasts for fiscal 1999 (ending June 30, 1999).

"On the conference call," said Jeffrey B. Davis, President of SmallCaps, "AMBI management indicated that the second fiscal quarter was progressing well and that its joint efforts with American Home Products, its preparation for launch of its direct marketing efforts over the internet and other channels and its other potential corporate development activities were all going well. We believe that AMBI shares are trading at compelling valuation multiples."

Mr. Davis also commented that SmallCaps is reiterating its BUY recommendation based on the facts that AMBI stock is trading at 6 times prospective net income and approximately 3 times prospective cash flow (EBITDA), despite expected high growth in both sales and net income. The analysts are maintaining their 12- to 18-month price target of $4 to $5.