MDCE looks very good, major pending news will be released next week! MDCE has been recommended by the Undervalued Dog, one of the most popular Internet newsletter.
SF
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MediaConcepts, Inc. (OTC BB, MDCE)
Recent Price: $0.20/share
Daily Average Volume: 250 K
97 EPS: $0.03/share*
97 PE:7
Estimated 1998 EPS:$0.47/share
Trailing PE:0.42
Book Value:$3.15/share
Price/Book Value:0.064
Div/Shr: None
Yield: None
52-week Range: $0.06-1.00/share
Outstanding Shares: 22 M
Floating Shares: 8 M**
Profit Margin: 25-30%
1997 revenue: $ 3.5 M*
Estimated 1998 revenue: $ 50 M
SEC filing:Yes
* 10K for 1997 will be released very soon.
** Total floating shares are 11.3 M, but 3.3 M shares, held by the previous management, can not be traded in the market, because of the ongoing litigations. These shares are not registered with the SEC and the previous management members are being sued by the current management for the illegal issuance of these shares.
MDCE is extremely bullish. Tendencies for prices to advance are extreme at 95-100% with a short term (3-6 months) upside potential of $2.00 and a long term (12-24 months) upside potential of $5.00. Buy under $1.00.
BUSINESS SUMMARY AND CORPORATION BACKGROUND: Through the development of a new corporate structure, MDCE has the following subsidiaries: Parthenon films, a theatrical and television production arm, Mindware, an interactive corporate training and educational component, Pasadena USA Ltd, and Pasadena International, a line of cosmetics and skin care
products. The company has also acquired a West Hampton sand and gravel pit with over 1.7 million cubic yards with a lifetime value of over 480 million dollars. MDCE, with subsidiaries, produces movies, videocassettes and television specials from its library of historical and stock film; rents its stock footage to the video industry; and converts educational materials into interactive media for home study. MDCE has obtained the rights to do a movie production of the late Harold Robbins novel Dr. Dan and the Plates of Gold. MDCE has the right of first refusal on all of Mr. Robbins novels not yet made into motion pictures or television productions. Mr. Robbins was one of the best selling novelists in the world having sold more than 750 million books in 23 different languages. In addition to its core business, MDCE recently acquired a Canadian cosmetic company, Pasadena International Inc.. Pasadena has full distribution rights in Canada for such highly recognized names as Sears, K-Mart, and Wal Mart, along with several other major Canadian chains.
In addition to their cosmetic line, Pasadena distributes a wide range of bath products and other decorative bath related items. Pasadena had $4 million revenues in 1997. It is expected that revenues from Pasadena in 1998 will add a minimum of EPS $0.10 per share to MDCE with gross sales of 10-12 million dollars. MDCE intends to increase sales by expanding Pasadena into the United States with some of the same stores for which they are already on an approved list
of cosmetic suppliers in Canada. Generally a company's sales in Canada represent about one-tenth of the same stores equivalent for the United States market.
RECENT DEVELOPMENTS AND ANALYSIS: The acquisition of Pasadena is the first in the efforts of the management to provide a consistent flow of regular earnings to enhance shareholder value in this company with solid earnings per share on a regular basis. The management is looking to increase earnings in MDCE through a few key acquisitions,
which would provide hard assets, and strong growth potential for its shareholders, and give the company recurring per share earnings with substantial cash flow. Currently, MDCE is actively working on several acquisitions and product distribution rights. These acquisitions and distribution rights will at least double revenues and earnings generated by Pasadena in 1998. For example, Pasadena is negotiating with Nike for a right to distribute a new line of five fragrances and other exclusive distribution rights for cosmetics and skin care products in Canada. Combination of these acquisitions and exclusive distribution rights is expected to generate at least $25 million revenues and to add at least EPS $0.25 for 1998.
In its core business, MDCE is working on production of several films as co-producers by providing its producing services and consulting. MDCE owns a library of historical and stock film footage, whose assets were valued by an independent appraiser and determined to have an asset value of $16 million. For example, one of the film projects in Turkey has the budget of $70 million, MDCE will receive $9-10 million for its involvement in the project. These fees and loyalties from these film projects are expected to generate at least $25 million revenues and to add at least EPS $0.22 in 1998.
Technical analysis indicates that MDCEs shares temporarily peaked at $1.00 last April, as its Relative Strength generated a bearish overbought reading. Since then, its trading is best described as quietly basing, which is not surprising because MDCE underwent a complete reorganization of its management last year. MDCE is getting ready for the next move now. Its Relative Strength remains oversold despite any real decline. Its On Balance Volume implies its shares are under heavy accumulation, adding to its positive technical picture. There is solid support in the $0.15 area. In the final analysis, although few clues as to when its current consolidation will end and its next leg up will begin, MDCE is in an ideal technical state for a further advance to new highs.
Managements unique background of finance, communications, entertainment, and education will position the company to aggressively seek a broad range of U.S. and international markets and maintain a leadership position in the worldwide business arena. We are very impressed with the aggressiveness of the new management in conducting their businesses. The new management took the company over last year after its several tumultuous years. Since then, the company has steadily taken all necessary and aggressive steps to restore its core businesses and to pursue new businesses. We strongly feel that the current management is very able and competent. The management is excited about the company future. They firmly assure us that they want to do right things for their shareholders. Namely, they intend to grow the company by aggressively acquiring other profitable businesses and to become a fully reporting company. They are confident that their stock will be adequately appreciated by investors as soon as investors realize the new direction that MDCE is heading and its extremely strong growth potential.
Recent litigations between MDCE and its previous management members will not have any significant material effects on MDCE earnings no matter how the litigations will be concluded. However, our legal expert in the security laws suggests that MDCE would have a great chance to win the case and recover the shares or receive monetary compensation, having reviewed and analyzed the lawsuits filed by both parties. A settlement in favor of MDCE is expected before the litigations are going to trial.
With these recent developments, MDCE may turn out to be one of the greatest turn-around stocks, maybe last opportunity that we will be ever able to grab before the 21st century. We advise accumulating its shares now just in case the next leg up of this dynamic little companys shares begins that we believe is going to happen very soon.
Contact:
Ed Broday, Corporate Communications
1555 S. Palm Canyon Dr., Suite D-201A,
Palm Springs, CA, 92264,
TEL: 760-320-9720
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chronological news releases, from this company prior to reaching any investment decision. One should also use the full battery of available technical analysis, including stock charts, moving averages, etc. and consult a licensed financial advisor for an independent opinion. The Undervalued Dog is not in the financial advisory business. The Undervalued Dog is not responsible for the outcome of anyone's investment decision. |
