DOCU: .22x.29, the optimal shell company.
Price: 0.22 x 0.29 (bid/ask 7/19/00)
52W High $ 1.00
52W Low $ 0.16
Shrs Out 4.20 mil
Float 2.70 mil
WHY DOCU IS AN OPTIMAL SHELL COMPANY
====================================
1. Active/Accessable Management.
2. They have $500,000 cash for the company.
3. Low Market Cap comparison.
4. Low number of outstanding shares.
1. ACTIVE/ACCESSABLE MANAGEMENT
===============================
It is important to know if management is
actively pursuing a reverse merger. The
CEO, Bob Schwartz, can be contacted at
518-786-7733. I have spoken to him several
times and he returns calls. He was a
director in the company and was chosen to
head up the search for a merger since he is
an investment banker. They did MRGO that
from $3 to $35. He is reviewing several
companies for the reverse merger. He
is getting paid in stock for his work. On
7/7/2000 I spoke to him and he just returned
from a trip to New York where he looked at
several reverse merger candidates. He would
like to have a letter of intent signed by the
end of July. NOTE: I keep in contact with
several shell companies. Many of them will
not return your calls.
2. THEY HAVE $500,00 CASH FOR THE NEW COMPANY
=============================================
After selling off their previous business,
they distributed all but $500,000. They decided
the cash would be more valuable to the shell
company in finding a suitable reverse merger
candidate. Operating companies are interested
in merging into a shell company so they can
gain access to the equities market and raise
additional capital. I would assume most operating
companies would be very interested in getting
an instant $500,000. This should help DOCU find
a quality reverse merger candidate.
3. LOW MARKET CAP COMPARRISON
=============================
One way to value shell companies is by looking
at their Market Cap. I base the market cap on
the current ask price since this is what you
would pay to buy the company. Below, I have
compared the Market Cap of DOCU to four other
shell companies that have recently announced
letters of intent for a reverse merger.
SYM SHARES ASK Market Cap
OUTSTANDING PRICE (On Ask Price)
----- ----------- ------ --------------
SHPS 19,997,160 1.7500 $34,995,030
LAMT 2,775,100 2.6880 $7,459,469
MMDI 13,700,657 0.1700 $2,329,112
BDRY 3,056,343 0.5938 $1,814,856
----- ----------- ------ --------------
DOCU 4,200,000 0.2900 $1,218,000
Both SHPS and LAMT have announced letters of
intent with wireless companies and have included
some details. BDRY has announced a letter of intent
with a printer refill company with few details.
MMDI has only stated in their SEC filings that
they have signed a letter of intent, but have
not given any details . . . not even the name
of the company.
DOCU has NOT announced a letter of intent. IMHO,
DOCU's current market cap of $1,218,000 has the
potential of reaching $1.8mil - $35mil when an
announcement is made. Below is DOCU's possible
share price at different market cap values:
Market Share
Cap Price
---------- -----
2,000,000 $0.48
3,000,000 $0.71
4,000,000 $0.95
5,000,000 $1.19
7,500,000 $1.79
10,000,000 $2.38
12,500,000 $2.98
15,000,000 $3.57
20,000,000 $4.76
35,000,000 $8.33
4. LOW NUMBER OF OUTSTANDING SHARES
===================================
DOCU currently has only 4.2mil shares outstanding.
This is considered very low. The public float
appears to be about 2.7mil shares. You will notice
the stock moves on very little volume. Usually, in
a reverse merger, new shares are issued to the new
company. Since DOCU has a relatively low number of
shares outstanding, it is possible that there will
not be a reverse stock split.
CONCLUSION
==========
Shell company investments are VERY risky. But, they
offer the possibility of substantial returns. I
witnessed SXML go from $.03125 to $50 ... a $1000
investment would have been worth $1.6mil.
In my opinion, DOCU is one of the best shell
companies currently available. If they merge with
the optimal company, such as a wireless company, it
is possible that the stock could be worth several
dollars a share.
NOTE: I own stock in DOCU. This information is base
on my assumptions, SEC reports, news releases, and
discussions with DOCU management. This is not a
recommendation to buy DOCU. Please do your own
DD (Due Diligence).
SEC filings:
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