Mike--Let me see if I got this right. We have the original SETO that looks like this:
$1.0 MM Revenues ~$200K Income 10MM shares $.02 EPS
First six months of FY97 are behind this pace, but still profitable.
Now, for another 10MM shares SETO picks up a private company that looks like this FOR ITS FIRST NINE MONTHS!!??!!
$15MM Revenues $1.6 MM Income 10MM shares $.16 EPS
Extrapolating 9 months to 1 year, with no other growth, we get!!!!!!
$20MM Revenues $2.1 MM Income 10MM shares $.21 EPS
Combining to get
$21MM Revenues $2.3 MM Income 20MM shares $.115 EPS
And the stock is at .38 x .42!!
Yiiiiiiiiiiiiiiiipes!! Am I missing something, or is it the street?
OK, let me play devil's advocate here. Does the acquired company know what it's giving up? Or is it they simply want to become part of a US stock exchange? Or are there other financial considerations here?
Shares are going from 10 to 20 MM right?
Mike, these are like the EnviroTec numbers for CSMA.
Lastly, and I mean no disrespect to anyone here, are the principals of SETO foreign nationals?
I ask this because I am a plaintiff in two class action suits in which both CEOs are foreign nationals. In the first one, Centennial, the CEO is in a Plymouth, MA jail held without bond for ten months because he is a flight risk(Israeli citizen and they don't extradite for white collar crime). The second is S3 and their CEO is a UK citizen No criminal charges have been filed against him---yet.
It may sound like I'm looking for an excuse NOT to buy but it's just my way of doing DD. Set up a straw man hypothesis to NOT BUY and collect enough data to (hopefully) reject that hypothesis.
On the surface, looks like a Multi Bag City South Pacific, to coin Franco. By the way, where do you think he went to?
TG |
