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Strategies & Market Trends : Value Investing

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To: Madharry who wrote (30408)	3/25/2008 11:57:04 AM
From: Paul Senior	Read Replies (2) of 78632

MCGC. Not happy that they will issue more stock now when the stock is trading below stated book value and so be diluting current shareholders. The current stock yields 18%. If they they take in money by issuing new stock, they must figure - I would presume - that they can make more than the 18% they'll have to pay out on those new shares (assuming they maintain current dividend). I find that a stretch at least, and corporate desperation at worst. jmo. I have more than a full position - a large losing position - in this stock, and I have decided to cut back on shares I'm holding. If I can get some understanding what the warrants will be worth given where MCGC stock will be trading at exercise time, I might add back. -- Since bdc's grow by issuing stock, and most bdc's trade now below book value, I unfortunately am starting to see other companies in the MCGC situation (e.g. GAIN)

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