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Non-Tech : Bill Wexler's Dog Pound -- Ignore unavailable to you. Want to Upgrade?

To: TRIIBoy who wrote (6323)	1/25/2000 5:05:00 PM
From: DanZ	Respond to of 10293

TRIIBoy, Gum Tech's President, Gary Kehoe, sold 50,000 shares of GUMM to pay for the exercise of 100,000 options that expired on December 31. The options had an exercise price of 5 5/8, so he had to pay Gum Tech about $565,000. Everyone doesn't have half a million dollars sitting around with which to buy stock, so Gary had to sell part of his holdings to cover the exercise cost and his taxes. If you look at Mr. Kehoe's salary, you will find that it is very modest, and you might even earn more than him. It is also common for officers to sell stock in conjunction with the exercise of options and I wouldn't read anything negative into it. Gum Tech's CFO, Bill Hemelt, exercised 18,000 options on December 20 and didn't sell any shares. Mr. Kehoe and Mr. Hemelt now hold 90,000 shares and 24,000 shares of GUMM respectively. You can look at Gary's transaction as selling 50,000 shares. I look at it as buying 50,000 shares. He could have sold all 100,000 shares, yet he only sold the amount necessary to pay the exercise. You can look at the glass as half empty. I look at it as half full. In the meantime, Zicam is selling very well, production is up to 60,000 to 70,000 units per day, international distribution should begin soon, nicotine gum production with Swedish Match should commence in a few months, and the stock continues to rally. Based on my earnings projection for this year of $2.08 per share, I think that GUMM will continue to rally, albeit maybe not in a straight line. If the company meets my earnings estimate, I believe that the stock will trade to 60 - 80. If you think that this is hype, then feel free to short away. It's your money. It wouldn't be the first time that someone on this thread accused me of hyping GUMM with what they think are outrageous targets. I put out a target of 25 to 30 several months ago when GUMM was trading at 10 to 12 and received the same criticism. I have done my analysis and am very comfortable holding a long position in the stock. The biggest risk to shorting GUMM in the near term is the publicity that will probably result from the release or publication of the independent clinical studies for Zicam, assuming that they are positive. You can look at VPHM for an example of what could happen to GUMM when the media gets ahold of a story about a promising remedy or drug for the common cold. The biggest risk to holding a long position in GUMM is the inherent volatility in the stock. The biggest risk to holding a short position is the bullish fundamentals. I prefer the long side because the fundamentals always win out over the short term volatility swings in a stock. Best of luck, Dan