Prime Stock Advisory Letter for December 22nd, 1998

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Today's Comments:   The overall market moved sharply higher yesterday.  The S&P 500 'SPX' and the S&P 100 'OEX' have clearly broken out to new highs,  but the Dow Jones Industrial Average 'INDU' has yet to confirm this move to new highs.  In the past the Dow Jones Industrial Average has proven itself to be the leader and its failure to move to new highs has ultimately resulted in a move lower.  The recent buying fever in the Internet stocks has raised a few concerns.  While these stocks are moving higher at a phenomenal pace they have the potential to move lower at an even quicker pace.  Caution is advised with these issues.

Company: GP Strategies        Symbol: 'GPX'         Closing Price: $15.00/share.
YH: $17.69      YL: $9.125         EPS: ($.17)        P/E: N/A       Forecasted EPS: $0.98
Dividend: N/A        Yield:  N/A       Ex Dividend: N/A
Price Targets:  $17.69 & then $26.25          Downside Stop:  $12.875
Options Recommendation: January 15 Calls,  Symbol 'GPXAC' @ $1.00/contract.

Company Description: This company provides professional training services to major corporations.

Recent News:  12/21  NationsBanc Montgomery Securities starts GP Strategies at a Buy
12/01  ILINC and GPX forge strategic relationship to expand interactive training services
10/01  GPX sells Five Star unit.

Our Analysis: GPX has recently made two major acquisitions that it has financed by the sale of noncore divisions.  These acquisitions are acreative and should add substantially to the companies earnings.  The recent acquisition of the professional training firm in England provides the company with an excellent entry point into the European market.  Yesterday,  Montgomery Securities initiated research coverage on GPX with a Buy recommendation.  I feel this is significant because several years ago Montgomery Securities underwrote the IPO on RWD Technologies 'RWDT' which is a smaller competitor to GPX.  The prominence of research coverage from a firm of Montgomery Securities caliber should help the shares of 'GPX' push towards our price targets.

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