Larry and Eric...
It is my understanding that revenues decline during the middle 2 qtrs.
because this is the high season for travel to Biloxi, which limits
the availability of discounted rooms for Casino Airlink. If you hadn't
noticed, the other reason for the decline in the eps is due to the
increased number of shares...I'm uncertain as to why this occurred, but
I have some ideas about this.
From what I know about the progress in Casino, they will book more
passengers this year which will translate into higher gross revenues.
I think they have also changed their accounting scheme which has lowered
their gross numbers without lowering their net.
Assuming the worse scenario, i.e. .01 eps/qtr = .04/yr on a continuing
basis, this would mean that POKR is selling at a PE of 6, which is
considerably lower than the industry standard which I've been told is
above 30. Now you add the assets in AVIA. I know it is difficult to
gather info on this company, but this is a company with assets and no
debt. I'm not certain about these numbers, but I seem to remember that
AVIA paid over $3M for their 15% in KIWI and about $2M for CITAmericas.
Assuming that these assets have at least remained stable, you can add
$5M to the pot. Believe me, Forhan would not have agreed to a deal
where the merging company did not bring something of value to the
table. IMO the $0.62 value was a compromise on Forhan's part to make
the deal.
Yes, the $0.62 value may be moot until the merger. It was conjured
so an exchange value could be established between AVIA and POKR. IMO
the depressed AVIA value has made POKR even more attractive, since
there will be less dilution for POKR owners in the new company if
present conditions prevail. However, it is the combined will of the
Board of Directors to raise the value of the merged company to a level
above $4 to qualify it for NASDAQ small cap. I don't think it is a
pipedream to believe these very capable and experienced managers to
accomplish this. Ride this thought with me a little....if the value
does get to $4 after the merger/acquisitions/etc., then a current share
of POKR will have risen about 8x (this assumes AVIA is about $1.20).
You may be right that nobody is going to pay $0.62, prior to the merger,
but if I have reasonably painted a proper picture, this is why the time
is NOW to accumulate. |
