We cannot guarantee that each stock will perform

in accordance with its rank. But we do believe that

over the long term, stocks rated Outperform (30%

of all stocks we rate) will, in the aggregate,

outperform stocks rated Neutral (40% of all stocks

we rate), and that stocks rated Neutral will, in the

aggregate, outperform stocks rated Underperform

(30%). All analysis is based on publicly available

company financials, fundamental ratios, relative

rankings of financial data and ratios, and observed

security prices.

Underperform Neutral Outperform

Fundamental

Quality

Technical

Factors

Value

Catch-up

Operational

Trends

Types of investment criteria differ in how useful

they are for predicting future stock movement.

Based on our research, the Composite Rank

assumes these relative degrees of importance.

This rating is based on analyses of share price

movements over a variety of time periods. We

compare performance characteristics of individual

stocks with those of all the others we rate.

Generally speaking, our goal is to favor up-trending

shares that have experienced recent corrections

and de-emphasize down-trending shares

experiencing uncharacteristic periods of strength.

Here is how EDIG shares performed during the

various periods we examined.

Price Change

This rating is based on characteristics traditionally associated with "good" companies. We focus on how each company

measures up against others, and give careful attention to recent improvement or slippage relative to other companies.

TTM = Trailing Twelve Months.

This rating measures the extent to which the share price adequately reflects improving or eroding fundamentals, and favors

shares whose prices have been slower to "catch up" to improving performance measures. TTM = Trailing Twelve Months.

This rating reflects how strong a company's recent Sales and EPS (reported as per GAAP) growth have been relative to other

companies we rate. MRQ = Most Recent Quarter. TTM = Trailing Twelve Months.

This section shows the comparison of key components between EDIG and several of its peers.

Reuters ratings are based on a proprietary model that leverages widely accepted statistical methods and financial concepts to select attributes shown to be strong indicators of future

stock price performance and applies these to rank stocks along a normal distribution curve. Ranks for Fundamental Quality, Value Catch-up, Operational Trends and Technical Factors

are combined into a Composite Rating of Outperform, Neutral or Underperform.

TTM = Trailing Twelve Months, * = Most Recent Quarter.

Whether you are willing to accept companies that have or don't have major shareholders with controlling ownership blocks,

multiple classes of common, or convertible debt or preferred issues is a matter of individual preference. Look here for

anything along these lines that might make you more or less inclined to invest in this company.

Look for accounting changes, restructurings,

etc.which may affect how useful historic data is

inassessing future company prospects.

This table gives an indication of how e.Digital Corporation stands in key respects compared with companies in the Electronic Instr. & Controls Industry

Start your analysis by learning what the company does, how well it does it, where it stands relative to peers, and whether aspects of the corporate structure or capitalization are

bothersome to you.

Technical analysts believe a narrowing of the bands suggests a significant price movement, up or down, will soon occur. Also, many say stocks that move outside the bands and then

back inside will soon move toward the opposite band. The Relative Strength Index (RSI) calculates the strength of the current price movement compared to other recent moves and

may signal when a trend is unsustainable. Technical analysts also believe RSI peaks/valleys forecast changes in share price trends.

Stock price trends depict the collective opinion of the investment community. You don't have to agree with consensus views but seeing how others feel can help you decide what to

look for as you go further in your analysis. Consider it similar to reading a review before seeing a movie.

When stocks significantly beat or trail the S

A high or increasing short interest implies that many investors expect the stock price to decline. You can treat that as a

warning. Or you can disagree with the crowd and buy stocks with high short interest in anticipation of a short squeeze (a rally

that occurs when short sellers rush to buy a stock, fearing losses they might incur if they wait too long). Prospects for a

squeeze are indicated by high readings in the "Days to Cover" column (which tells how many days it would take for all short

interest positions to be covered if recent trading volume levels persist). The risk: The bears may be right. So research other

aspects of the company.

Insider buying can be seen as bullish because,

presumably, their company knowledge is superior.

However, insider sales are less reliable because

insiders may sell for a variety of reasons that have

nothing to do with their opinion of the stock.

It's worthwhile to know what institutions are doing

simply because their stock positions can be so

large. In the short term, stocks will perform well if

institutions are buying and perform poorly if

institutions are selling.

You can follow popular opinion or choose a contrarian's strategy. Either way, you should know whether the Street is bullish or bearish. Investor sentiment is typically positive when

the 50-day moving average is rising, especially if it's also above the 200-day moving average. Additionally, changes in price trend can be deemed more definitive if supported by

higher than normal volume.

Many people erroneously work with valuation ratios calculated based on numbers that aren't truly representative of a company's underlying sustainable financial characteristics. Thus

it's important to determine if today's sales and EPS are significantly depressed or elevated due to temporary factors such as business cycles. Higher ratios can be tolerated if sales and

EPS are temporarily depressed. But if the company is experiencing unsustainable boom conditions, seek lower ratios. GAAP = Generally Accepted Accounting Principles.

The faster a company grows, the higher its stock's P/E can be. Contrary to popular belief, PEG (P/E over Growth Rate) need not always be 1.00 or less. But all else being equal, lower is

better (and 3.00 is usually too high). Try to favor company PEGs that are lower than industry and market PEGs. In all cases, watch for very high growth estimates. If overly optimistic

projections get cut, PEG would wind up being higher. FY = Fiscal Year.

Valuation below industry or S

Dividend is the most classic basis for

stockvaluation, and high dividend yields are

usuallydeemed preferable. Today, with many

companiesreinvesting profits back into the

business, moderateor low yields can be accepted if

dividends growrapidly. The main risk is that poor

performance willcause the dividend to be cut or

omitted. A very highpayout ratio is one warning

signal. Another is ayield that is very high relative to

industry peers.

TTM = Trailing Twelve Months.

Get a general sense of the extent to which the

stockprice is offset by the presence of assets that

can beconverted to cash immediately or in the near

future. Often, these ratios will not be meaningful.

Most companies are valued as ongoing businesses,

rather than liquidation/buyout prospects. If you're

lookingat an especially troubled company, be aware

that seemingly liquid-asset windfalls can be

dissipatedby continuing operating losses and/or

shutdown costs.

Determine if the stock price is justified by: growth-based value, comparative value, liquid assets, or dividends. The better the company, (in terms of growth or quality), the higher the

valuation measures can be. And if valuation ratios are extremely low, double-check to see if the company appears excessively weak. In any case, you don't have to say yes to any

valuation measure - many buy shares based on other factors (e.g., growth). But if you do that, at least understand what you're doing and consider the risks.

Investors are accustomed to looking at EPS growth. Check sales growth, too. EPS gains can't persist indefinitely without good sales growth. Do further investigation if sales trends are

falling short. (A big short fall might reflect a divestiture. On the other hand, if sales growth looks too good, check to see if it's being boosted by an acquisition.) Also, compare sales

growth to capital spending growth. Over a prolonged period, it's reasonable to expect capital spending growth to more or less keep pace with sales growth. If the latter is significantly

higher, capital spending may have to accelerate in the next few years.

Some companies excel in obtaining high margins (watch out for very low tax rates, which may reflect special benefits that often won't persist indefinitely) while others are highly

efficient. Still others are strong in both respects. These trade-offs are balanced in the Management Effectiveness returns, which combine both factors. TTM = Trailing Twelve Months.

Quick Ratio (cash and marketable securities divided by current liabilities) and Current Ratio (all current assets divided by current liabilities) give a sense of how readily the company

could cover current obligations if the sales were to stop. Higher ratios indicate greater liquidity. Different businesses have different cash inflow-outflow characteristics, so compare

companies to industry averages. Similar comparisons are relevant for debt ratios (higher ratios indicate more debt and, hence, more financial risk) and interest coverage (lower

numbers signify greater risk).

In many respects, business success requires subjective judgment. However, over time, good companies tend to leave good footprints, which become most visible when company data

is compared to industry/sector/market benchmarks. That's how you see when companies perform well, not just because a rising business tide lifts all boats, but because the company

is doing unique, good things. Look, too, at time-series comparisons, and take note of companies that are improving faster or suffering less than peers.

Change for Past 180 Days: