Safeguard Scientifics SFE Message Board

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Technology Stocks : Safeguard Scientifics SFE

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To: David Lawrence who wrote (2023)	11/24/1998 11:47:00 AM
From: John Arnopp	Read Replies (1) of 4467

Good points. The only benefit served is to reduce the number of outstanding shares, which reduces the number of rights offering shares they will have to sell in each offering. If we assume they were able to buy back about 2mm shares with their combined $40mm, this would mean 400K less rights they could sell, allowing them to retain those shares. At $5 they would be worth $2mm, or about $1 per share purchased. Still not a good investment unless the premium is $3 or less (at 3 offerings per year) - or if the future companies would trade above $5. Leads to a good strategy for investors, though, especially in the absence of offerings: When there is a premium, buy the most beaten down public companies (anyone for more USDC?) and when there is a discount, buy SFE. --John

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