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Microcap & Penny Stocks : SEDONA Corporation (SDNA)
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To: Jerry Rush who wrote (366)9/10/1997 2:07:00 PM
From: James Bowser   of 731
 
1. I highly doubt Oracle is going to buy SCNG. Remember, Lockheed Martin still owns the source code that is the basis of Sedona Geoservices and they will get royalties from any sales of software. As such, it would not do a buyer any good to purchase SCNG, as they would not own the technology outright. Sedona is simply the Master Value Added reseller for the GIS software.

2. Today's news, although good on the surface, appears to be Osterwise's way of saving SCNG some cash which they need to conserve. Since he can buy stock at a discount to the current market price it is a layup. Nothing stops him from setting up an arrangement where an offshore investment firm sets up a short postion in SCNG. He collects the cash from the short sale and excercises his warrants to buy and then delivers his stock to the investment banking firm which they then use to cover the short...it is reported as an insider purchase when in fact it never was. They get a fee and he gets his salary up front. I am not saying this is what is going to happen, I just want people to see the underlying possibilities. It may very well be his intention to buy stock and hold it. I don't know.

3. SCNG is a highly self promotional company. Compare their valuation to a company like Map Info and you will find the stock is very overpriced here.

4. In the long run it is earnings that make a stock go up, and it would seem that SCNG is still at least a year away from that.

Don't bash me for posting in the negative, I have followed SCNG for 3 years and even visited the company before. I have seen this hype before only to watch the stock go back down on the lack of results on the revenue and profit front. The management and insiders tell a very positive story, but so far that is all it has panned out to be...an intriguing story. I am not saying the stock should be shorted, but I am saying any new buyers may want to inspect this situation very closely before putting their hard earned money into the stock above $4. Good Luck.
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