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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG)
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To: ztect who wrote (24064)4/5/1999 10:07:00 AM
From: Zeev Hed  Read Replies (2) of 44908
 
I have no problems with Craig analysis, one should remember however, that the first few points are based on past facts while the last four points are "possibilities". Numbers like $200 MM in annual sales are bandied around like if these were peanuts. To support such sales one needs working capital of at least $80 MM (AMZN with sales of $610 MM has WC of $260 MM and they just borrowed another 1.25 billion at 4.75% and a fixed conversion rate). Where will that money come from? Not from retained earnings.

A lot is made of the "Signature" deal, this is a business in which Gordon so far has failed miserably, so now he has negotiated a new hourly rather than commission based deal, you think that that is going to make this business extremely profitable? Signature is farming it out because they cannot make money at it on their own, and our genius Gordon will make money at it? Possibly, but past history indicates that he might choke on this deal rather then provide cash flow.

We must differentiate between "deal making" and "money making", and so far, Gordon is not exactly the guy that has shown expertise in the latter. Shipping a dollar worth of goods in a $12 dollar bill is sure way to financial oblivion.

If Craig is serious, what we should engage in next is a down to earth analysis of the realities of these deals and the type of margins one can expect rationally. I have already stated in a prior posts that assuming 50 Mm kids selling cards for charity is nothing but preposterous, I never received a quatitative rebuttal on that. That might be a good starting point.

If one does not learn history, one repeats it.

Zeev
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