Intrawest Corporation (ITW.TSE) (IDR.NYSE) Message Board

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Gold/Mining/Energy : Intrawest Corporation (ITW.TSE) (IDR.NYSE)

ITW 252.24

-0.1%

Dec 29 3:59 PM EST

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To: Don Gordon Lee who wrote (41)	4/8/1999 9:12:00 PM
From: thomas gentry	Read Replies (1) of 46

Don, I'm inclined to agree with your "no hold" strategy, at least for the short term. While I'm on the record for my support of Intrawest's latest 3.45 million share issue, it would be unreasonable not to expect a gradual re-valuation of the stock price as a result of the dilution. By my figuring, the new share offering has immediately diluted our holdings by roughly 8.03%. Applied to Tuesday's "pre-announcement" closing price of $26.40, this implies a diluted price of $24.28 (all other things being equal). So far we've only suffered half that loss, thanks in main to heavy buying support by the underwrighters. It seems clear to me though that sooner or later this support will wan and Intrawest will approach (and probably fall below) its diluted price. While Intrawest remains as fundamentally strong (and perhaps stronger) than ever, simple mathematics argue convincingly for a continued short term sell-off. With slightly more than a month until Intrawest releases what should be a strong series of third quarter numbers, this may present an interesting "buy on dip" trading opportunity. Any comments on this strategy? Thomas

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