OPTI Message Board - Msg: 1819300

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Microcap & Penny Stocks : OPTI

OPTI 0.00160

+23.1%

Jan 9 9:30 AM EST

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To: Liatris Spicata who wrote (326)	7/23/1997 11:15:00 AM
From: dlc	of 482

One of my colleagues spoke to the CEO a few weeks ago. The substance of the call was that if the market wouldn't properly value OPTI on a prospective earnings basis, the company would improve shareholder value via the balance sheet. This is one of the reasons, for example, that OPTI's cash went up in Q2 even as it posted a loss. Everyone we've talked to (and we've talked to everyone) hints of big restructurings and shareholder value actions but no one provides specifics (for obvious legal reasons). Asset sales, such as Tripath and the stake in the Taiwanese foundry, are possible but so are lots of other things. I don't know about acquisitions. Purely on the basis of asset values and known income streams, my colleagues and I put the company in the $10+ range. The company (and its external consultants) put the value of the company at $12+. Since they know about asset realizations and future income streams that we can't know at this time, I don't think their valuation is unreasonable. My guess is that the company is looking at the next few months as a make-or-break period. Either the PCI audio chip and certain core logic chips (certainly Firestar and possibly Vendetta) take off and the earnings trend propels the stock upward or the company will look towards selling itself in whole or in part. I don't believe the directors will let the intrinsic value of the company dissipate if a turnaround is not coming by the end of Q3. I fully expect to see some action on the shareholder value front before the end of the quarter. If it is accompanied by action on the earnings front (read: PCI audio) so much the better. Their products are very good and I hope they do well.

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