Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (7523)	10/5/1999 12:59:00 AM
From: Mike Buckley	Read Replies (3) \| Respond to of 54805

Now that I've been able to absorb just a little more information, I've come to think there is somewhat misleading information in one of the articles. I don't remember whether or not it was a press release. One of the statements is about the combined companies' revenue of more than $1.5 billion and an enterprise value of $20 billion. Both are futuristic, maybe by a year or two depending on how fast the company and the valuation grows. Just for fun -- and I mean literally just for fun -- I'm going to take a short-term guess about the price of the Gem's stock. I think it's going to head south. I believe shareholders will question Henry's unproven ability to run a company much, much larger than he's ever run. There is always the question of successfully integrating technologies, marketing strategies, corpporate cultures, etc., etc. The company will now have about twice as much debt as cash, which is unusual for current stockholders of Gemstar though not at all a serious problem. The purchase price is considered high by a lot of people, though that varies with the price of the stock between now and the time of closing. And last but not least, this outcome was not expected by many, so investors who bought on the rumor will be selling on the news. Because the news has a twist that was not expected, selling may be stronger than it otherwise might have been. Hold me accountable, but be nice if I'm wrong. I'm notoriously awful about predicting short-term movements. --Mike Buckley