Rumor around SI that FILM has news pending. . .Their primary biz is PLCO . . . and we have been patiently awaiting PlayCo's biggest news in years. . . the opening of their TOY website. . .which the company said in last PR would occur in May. . . so it doesn't take a rocket scientist to figure out that there's a "good chance" the site will be announced.
Once again PLCOP [the preferred] is greatly lagging the commons. Preferred converts on Dec. 29 at a rate of 3 commons for each pfd.
My guess is that this announcement will be accompanied by one or more major portal deals. . .Remember that the website that opened earlier in the year was their OUTLET for overstock and discontinued toys.
The website that we are awaiting is the one that is expected to be available in a kiosk within each of PlayCo's retail stores. . . this is so that they can offer more variety without holding stock. . .and so they can offer a wide selection of collectibles, dolls and other side products, in addition to their full line of popular toys.
For instance, a mall store can reasonably carry a few bicycles. . .one or two of each variety, whereas the website could carry a full selection of BMX, Tricycles, Unicycles, Mountain, Touring, or other
specialty bikes. . . and accessories.
Likewise, they can offer collectible Barbies, without having to hold inventory of the expensive dolls at each of their retail outlets. . .
The price of the common has held up quite well through this waiting period. . . I expect we break old high on this move when it comes. And I expect that PLCOP will soon sell for a premium over the common issue.
At a 3 to 1 conversion, as the common rises the preferreds potential value increases disproportionately [or proportionately, depending on your point-of-view] For instance, PLCO common rises from 2 to 3. . . value of pfd increases [upon conversion on 12/29/99] from 6 to 9. Common moves from 3 to 4, pfd value goes from 9 to 12. . .Common 4 to 5, pfd 12 to 15 and so on. . .
So a 3 pt rise of common from 2 to 5, could send the pfd's from 0.75 to 15.00. . . hello?
Yeah, I am loaded up [relatively] with all forms of PLCO and ready to hear some amazing portal deals. . . and considering the way these other OTC internet stocks are quickly bidding up, when they are new. . . I expect this long established retailer and now e-tailer, that showed a nice profit last quarter. . .will follow suit.
Rande Is |
