SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Non-Tech : GRIN (Grand Toys International Inc)
GRIN 27.30+1.1%Dec 3 3:54 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Kevin Podsiadlik who wrote (460)11/19/1999 3:31:00 PM
From: Frank McVerry  Read Replies (1) of 495
 
Kevin,

<<Um, the 10-Q pretty clearly states a cash position of $280K, AFTER taking
into account the $8 million from stock options.

Care to make any other trivially refutable statements?>>


The $14M cash position for GRIN was my year-end estimate, that is,
the end of their Christmas 'inventory purchase - accounts received'
cycle. That number is the only valid number for evaluating their
cash position within a value estimate. Their intermediate cash positions
at other times in this cycle are irrelevant to the calculation.

The $8M option cash has not 'disappeared' but has been applied to
inventory purchase, rather than creating an $8M short-term loan on
their credit line - much more effective than putting the cash in a
CD or T-bill (a personal example...if I have $1000 spare cash getting
1% in my check account and a credit card loan of $1000 at 19.9% which
I can pay-off over 3-5 months from my cash flow, then it makes a lot of
sense to pay the loan with the cash and replenish my cash with my cash
flow).

The LTD you mention is a proper offset for the same amount of year-end cash
(thank you for keeping me right on that) and I estimate it would adjust my
revised estimate of dako's normalized valuation by 40-45c, to
$12.03 to $12.08. However,it would be a mistake to cast dako's
sales/margin/multiplier estimates in stone - I think there are easy
arguments for say $45M or more in 2000 sales, and slightly higher
net margin and PE multiplier, pushing his low-end no-growth scenario
to a logical floor above $14.

It seems that the last few posts have been putting the low-end risk
for GRIN under the microscope (and rightly so) but I am also interested
in the upside possibilities and would be interested in your comments.

Frank McV
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News