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Microcap & Penny Stocks : ISGI ANYONE????

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To: Robert Dutton who wrote (1250)8/1/1996 7:51:00 PM
From: John H. Flint   of 2665
 
All: Ho-hum....another $22 million in additional revenues. I know people get frustrated at the lack of movement in the stock with all the apparent good news. I am frustrated as well. But what I am focusing on is the continued laying of a solid foundation in what appears to be a full service worldwide telecommunications company.

As I watch the stock trade it still is in the grasp of the day trade/short crowd. These guys care less about what ISGI releases as far as announcements. They care less about what is a "fair value". All they care about is making money and this stock has proven to be a HUGE cash cow for these guys. With ZERO investment banking support, firms can sit on the offer all day and dole out shares at 1 1/8, knowing that later in the day as the retail volume dries up they can walk this thing right back down.

This week is a perfact example of how things work for these guys. For example NITE & MHMY was on the offer at 1 1/8 on Tuesday. They would have sold you whatever amount of shares that you wanted. For arguments sake lets say that between the two of them they sold you a 100,000 at that price (1 1/8). Today both firms were sitting on the bid at various times at .94 & .97. They would have taken whatever you wanted to give them. That .16 to .19 cent spread on 100,000 shares is $16,000 minimum for this trader and his firm. This is BIG money for these guys and they can do it ALL DAY with ISGI.

What allows the day traders and short crowd to do this is what I have been pointing out for ages. ISGI has NO investment bank to be their friend. No one to stand in the gap. As Alex G pointed out in an earlier note, the stock bumps its head at various resitence points only to come back down to support. The good news is that the support levels seem to be steadily increasing. But what is finally going to allow this stock to move higher will be some new IB or banks to embrace the company for its revenue/earnings potential. When this happens the margin that the day trade/short crowd can make in the stock will be minimal and the artificial "ceiling" that these guys put up at 1 1/8 or whereever will go away. Why? because they know that the stock has real support from friendly IB's who will take away their ability to control this issue. They will move on to some other weak sister so they can make their money from some other easy pickens. I guess you would do the same thing if you were one of these traders. Its their game and this one is "taken candy from a baby". There is no other explanation for the large volume/no increase pattern that this stock has been in for the past YEAR!

What I am pleased to be seeing is the production of viable announcements backing up the company's initial TWT rhetoric. $53 million in additional revenue in 6 weeks. That is incredible. ISGI did a total of $4million for all of last year and traded as high as $1.91!

I am content to wait this thing out as I feel that it is only a matter of time before the company is embraced by a sizable IB to be its friend. I have been able to verify JC Bradfords interest in taking TWT public via an IPO. Why wouldn't they be interested in being the Inv. Banker and possibly doing a secondary now that they are a part of ISGI? Same company, same potential. If it is not JC Bradford it could be someone else. It just is plain common sense with all of these positive announcements. Am I missing something? Maybe I am, but IMO a real exciting situation appears to be developing and I will remain patient to allow this thing to develop.

John
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