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Microcap & Penny Stocks : Diamond Entertainment Corp (Previously DMEC) -- Ignore unavailable to you. Want to Upgrade?

To: OLD JAKE JUSTUS who wrote (4583)	6/10/1999 10:28:00 PM
From: DBrian	Read Replies (1) \| Respond to of 6957

Analyst Group Update: DIAMOND ENTMNT (OTC BB: DMEC): The stock was unchanged to finish at $0.165 with a light volume of 694.5 K shares, about half of its 3-month daily average. Today the company announced the successful arrangement to reduce its current liabilities by entering into agreements with its two largest business creditors to convert their remaining loan balances totaling $1.9 million into one-year restricted DMEC common shares. The company is working hard behind the closed door to get some deals done. Indeed, it's a very nice move! First, the company significantly increases it cash flow. Thus, they have the necessary capital resource to invest in its e-commerce sites, to increase its product lines and to intensify its marketing campaign. Second, the company will be able to improve its earnings, as the company will save its interest payment on these loans (often the business interest rate is about 10%, it's about $0.2 million a year). Third, the shares are restricted for a year. Thus, there is no direct dilution to the current shareholders in the short term. On the other hand, it indicates that the creditors have great confidence in the future of the company. As we know, when we want to have a mortgage for our new home, the first thing that the bank does is to check our credit history out and to send somebody to appraise our home value. Nobody is a fool when he is asked to give away hard cash. These creditors are no exception. They are smart enough to not throw $1.9 million away for nothing. Obviously, they want to have a piece action of e-commerce in the new millennium, as more and more business activity moves into the Internet stream. We expect the company will have some major news in the coming weeks. Remember, news is what moves the world and the markets. It's all around us, and if the news is right, the stock will soar! The stock is rated hold. --------------------------------------------------------------------- Copyright 1999, analystgroup.com. All rights reserved. Persons may reprint or copy any portion of this publication, provided any reprint or copy is accompanied by our web address (http://www.analystgroup.com).