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Non-Tech : RAINFOREST CAFE -- Ignore unavailable to you. Want to Upgrade?

To: gizelle otero who wrote (4639)	8/9/1999 7:43:00 PM
From: Frank McVerry	Respond to of 4704

So the RAIN pres has now seen the great value in his company ! I like the big 'free' cash flow (eps + D&A) that RAIN is generating and growing at a healthy clip. The negative SSS is going to remain an important issue and will put an upper bound on its price but as this fell and fell to the point where the company could have bought all the stock back within 2 years and easily remained profitable beyond that time, undervaluation was obvious. This business can be replicated many more times within the US and clearly it works in the rest of the world too, given the rapidly improving stream of royalties. Also, it looks like (touch wood) the company's controversial means of stock buyback using put sales is finally bearing fruit, with many of these heading for worthless expiration this month (or very low cost, in the case of the Aug 7.5s) - another chunk of change for their bank account ! FWIW, Frank