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Microcap & Penny Stocks : STRATEGIC SOLUT (Nasdaq:SSGI)
SSGI 0.0250-37.5%Nov 1 5:00 PM EST
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To: BlueCheap who wrote (145)8/25/1998 12:24:00 PM
From: ComSolut  Read Replies (1) of 388
 
Malcolm - I hesitate to boil the 10QSB down -

But since you asked I will start with my conclusion
first:

The stock has become a MERGER play or will be
delisted and become insolvent. If the merger does
not take place ZERO will be the share price. I repeat
HIGH RISK! I knew the stock was a merger play but
did not realize the downside was ZERO.

Okay for the 10QSB points:

1) CASH FLOW - is a problem. In the report it
states that there are not enough funds to meet
either short term or long term obligations. The
ability to raise capital is questionable.

2) Income statement - LOSING money. Accts.
Receivable is high. RED INK NOW AND IN THE
FUTURE.

3) Litigation - ongoing and a fair bit of the cost
is reflected in the income statement. (I thought
the litigation was over but the REG D is asking
for $ 160,000 in penalties - Mr. Cadigan says no)

4) UST - looks good on the balance sheet - but
in reality UST cannot meet its financial obligations
either and may never.

5) Outstanding float - The way I read it - WILL INCREASE -
by 6.5 times the "Target's" shares. Float should increase
from approx. 2.25 million to at least 5.5 million and
could go as high as 10 million authorized shares.

Numerous other small points - but the above covers
the highlights.

OKAY - items 1-4 might be considered irrelevant IF the
merger goes through. Item 5 will, however, create a
higher hurdle to share price appreciation.

Is there value here - I still believe so and I am willing
to incur the extra risk revealed in the 10QSB ON THE
ASSUMPTION THE MERGER WILL OCCUR.

I would not bet the farm on this one if you are risk
adverse.

LONG but worried.

ComSolut
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