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Strategies & Market Trends : Value Investing

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To: James Clarke who wrote (10150)	3/8/2000 9:27:00 PM
From: Paul Senior	Read Replies (1) of 78565

Jim, Jackpot, and Mario: Congratuations on Jackpot. It was a good value play at $8.00 all right. The risk being that the investment banker guy running it would do something not so great with the $8 cash. And Jackpot's business - servicing slots in Nevada - maybe was worth $2 a share more. It wasn't a very profitable business though. At $12 -13/share (up from $8) maybe there was some clue that something might be happening. A technical chart breakout perhaps - stock hadn't traded so high for quite some time. And Mario Gabelli in with a big position. Even adding to it if I recall correctly (not sure). To me, here's a case where the mutual fund manager has it all over the little guy. There is NO reason (imho) that anyone reading the public documents or studying the crummy business would take a large position in this stock at $10 or more. Other than the $8/sh in cash, there's really (again imo)no hidden value to pull out of this business. There was no reason for a fund manager to hold on to the stock when it got over $13 - at least based on publicly available information. The value was not there. MARIO GABELLI HAD TO HAVE KNOWLEDGE THAT WAS NOT AVAILABLE TO THE GENERAL MARKET. Namely, that J's management was preparing to totally transform the company in a very positive way - by becoming an incubator and populating the company with high powered internet execs and entrepreneurs. As they say in bridge, a peek is worth 100 finesses. Super Mario wins again! The lesson maybe is to keep following Mario - he knows exactly what he is doing. And now that the company won't have earnings, but instead will have potential spin offs, plus power players plus Mario to tout it, the stock could easily (imo) go to 40 from today's 21. jmo, Paul

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