Sanctuary Woods recent sale, should you own the stock? Message Board

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Microcap & Penny Stocks : Sanctuary Woods recent sale, should you own the stock?

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To: Jane Shea who wrote (5)	5/18/1996 6:30:00 PM
From: Jamie Westock	of 341

The way companies are priced sometimes seems like voodoo valuation. Basically, a pricing should be based entirely on future prospects for the company. This is the reason for the high valuations placed on cos. related to the Internet like Netscape and Yahoo. Despite losses, a company can still sell for a high valuation IF the future revenue, company and product positioning, and sales momentum are there. The one good thing I like about SW is that for such a small co. they have a very international distribution so its not dependent solely on the U.S. market. On the other hand though, it doesn't do high-profile marketing. Maybe this is the reason it decided to get out of the entertainment title biz -- costs too much to do the promotion. Anyway, to get back to your original question about what kind of pricing for the co? It's really impossible to pinpoint. But, based on the clean-up activities the new management has done to the balance sheet, the new strategic focus on educational titles, and the broad international product distribution, SW should be worth 3-4 times its current stock price.

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