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Technology Stocks : TouchStone S/W (TSSW)

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To: jonj1 who wrote (3149)3/10/2000 7:04:00 AM
From: David Alan Cook   of 3627
 
jonj1,
TSSW has huge gains in at least 3 companies that they will be able to recognize in the near term. The best indicator in my opinion to measure the value of TSSW is 5 times Net Cap assets per share.
In the last news release, TSSW stated that " The company anticipates a high percentage of incubator clients will graduate within the first year. " The company also stated that they " . . . may realize short-term liquidity from public offerings and achieve value appreciation and return on investment. "
Regarding impact of sale: TSSW has a large capital loss carry forward that they can use to offset gains in the future. TSSW will still benefit from sales of the company's software products until sale is approved. Most of the benefit from the sale of new products will be noted in the fourth and first qtr. More in the first than the fourth qtr.
Bottom Line is that the Incubator area is a high growth investment area - the software product is not. The insiders have a huge incentive to increase the value for all shareholders as the CEO and VP are the two largest shareholders.
Expect TSSW to have a one time gain from the sale of the assets in the qtr the deal is finalized as TSSW has taken a large part of the amortization charge.

DC
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