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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Emmo who wrote (12815)	1/27/2000 11:59:00 AM
From: Richard Spitzer	Respond to of 14266

Emmo - I agree with your final statement. I believe that Chanos and the MMs and our analysts have some sort of a deal working, where Chanos has until mid-February to cover at these levels . After that, the MMs and analysts will let the price soar. FWIW, I tried the last few days to daytrade a few THQI shares, and met with utter failure (a 5/8 point loss). And mentally, day trading is not for me. I have some Feb and Jun calls, but otherwise everything is long term, so NO WORRIES! I took the money I got out of the day trade, plus some of my AKLM holdings (what a mess there!) and bought some ATVI today. Rich

To: Emmo who wrote (12815)	1/27/2000 12:03:00 PM
From: Brian MacDonald	Read Replies (1) \| Respond to of 14266

This from the Yahoo Board courtesy of T. Seltzer. BTW, Chanos and friends have been losing big on TYC and SFP lately as both have been rising on great earnings and bullish projections. Could it be that the 'hedge-fund' that these guys run is in such bad shape that they are bringing out these old arguments again to try and cover their short position on THQI and hope to live another day? Seems pretty desperate. Also, if having this BS placed on the TSC can only impact the stock by less than a $1.00 on less than stellar volume, we must be seeing a bottom. Brian -------- Herb Blew It - Here's Why by: TSeltzer (36/M/Los Angeles) 1/27/00 11:28 am Msg: 30472 of 30487 Herb just plain screwed up the receivables issue. He just didn't understand what was happening. It looks like he just listened to whatever the anonymous short was telling him without checking the facts. That's pretty sloppy journalism, but we're stuck with it. It's pretty easy to demonstrate. Here's what Herb said: <In the third quarter, THQ's reserves fell to 36% of accounts receivable from 54% in the prior quarter. Interestingly, in the same quarter, Acclaim's (AKLM:Nasdaq) reserve rose to 40% from 32%.> First, he's wrong about the "same quarter." THQ and AKLM don't report on a same quarter basis. Acclaim's numbers are from August 31, 1999 (their 10-K) while THQ's are from September 30, 1999 (their 10Q for 3Q). Be that as it may, let's give Herb the benefit of the doubt on that one. Second, Herb just screwed up the numbers. How does he get to 40% for Acclaim? Here's how: Page 43 of Acclaim's 10-K includes a table called "Accounts Receivable." I'm sorry if the numbers don't line up exactly, but here's what you find for August 31, 1999 for Acclaim: Receivables assigned to factor . . . . .$98,470 Advances from factor . . . . . . . . . . . . 26,410 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Due from factor . . . . . . . . . . . . . . . . 72,060 Unfactored accounts receivable . . . . 10,599 Foreign accounts receivable . . . . . . . 37,461 Other receivables . . . . . . . . . . . . . . . . 3,924 Allowances for returns and discounts (39,614) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $84,430 Now, how does Herb get to his 40% for Acclaim? He divides the "Allowances" figure of $39 million by the "Receivables Assigned to Factor" figure of $98 million. That gets you 40%. The only problem is, that is not Acclaim's receivables. Those are just the receivables that Acclaim's factor would accept (most likely the easiest to collect). The short who gave this info to Herb forgot to add back in the "Unfactored Receivables," "Foreign Accounts Receivable" and "Other Receivables." There's $51 million right there. Add that to the $98 million assigned to the factor, and you have $149 million. What's $39 divided by $149? It's 26%. So Herb, if you look at the correct numbers, here's what your statement should have read: <In the third quarter, THQ's reserves were 36% of accounts receivable. Interestingly, in the period ending August 31, 1999, one month earlier, Acclaim's (AKLM:Nasdaq) reserve was 26% of accounts receivable.> Shazam! Will you look at that! A full 10% better than Acclaim! Unfortunately, guys, that's what happens when journalists get lazy and simply rely on shorts with an agenda. Herb didn't check the facts. It's very sloppy reporting, and we've lost alot of money because of his mistake. I'll check around and see if some of my sources can figure out who gave Herb that information. If it was Chanos, we really should report him to the SEC for this one.

To: Emmo who wrote (12815)	1/27/2000 12:14:00 PM
From: Kory	Read Replies (1) \| Respond to of 14266

Good to see Herb help define the short case some more. Always good for a laugh during the day. My favorite is comparing the end of Q2 to the end of Q3. You'd think that even Herb would know that video games are seasonal, and that you probably should look year-to-year, rather than one quarter to the next. Hey, just thought of something - we are probably going to make $.65 at least in Q4 1999. If I take that times 4 quarters, we have $2.60 in earnings. Simplistic thinking - the market is full of it these days. In regard to reserves, what is important is the overall dollar level of the reserves, as well as the ratio of the reserves to the amount of unsold product. Comparing the reserves to the amount of gross receivables is not that meaningful, since receivables may or may not reflect unsold product. For all anyone knows (Herb included), THQ could be more conservative now that they were last year. Funny how Herb classifies EA as a "class act". Here is the comparable info for EA on reserves: March 31, 1999 (end of fiscal year) Gross Receivables - $222,318,000 Reserves - $ 72,850,000 (32.8% reserved) Net Receivables - $149,468,000 September 30, 1999 Gross Receivables - $330,496,000 Reserves - $ 64,747,000 (19.6% reserved) Net Receivables - $265,749,000 So aside from the fact that the issue doesn't matter because of seasonality and a weak relationship to receivables, you have bigger percentage drop in EA, not to mention an overall lower reserved percentage, as well as decreases in absolute dollar terms when receivables increased dramatically. The one issue that might have a little substance is the capitalized software costs issue. These capitalized costs were up about $9 million over last year's 3rd quarter. But given the much higher quantity of releases in the 4th quarter, it doesn't seem unreasonable. Bottom line is that Herb is guessing and doesn't even understand the industry. What has made THQ money at competitors expense is it's focus (for the most part) on publishing games based on established hit licenses, rather than trying to develop them internally. Not to mention great timing, what with the WWF now approaching 3 times the audience as WCW on Monday night. But, in the end, here's hoping that Herb can drive us down a few more points to allow even better opportunities to buy more. Kory

To: Emmo who wrote (12815)	1/27/2000 12:22:00 PM
From: Apakhabar	Respond to of 14266

On a positive note, JEFF has quit selling and is on the inside bid buying whatever comes. Unfortunately the sellers have come out of the woodwork. Assuming that Chanos has been working hard to bad-mouth THQ to as many media sources as possible, we might keep in mind that the goal of going long THQ is to make OUR profit. Twain said, "It is not enough for a man to succeed. His enemies must also fail." As much as we might all like to see Chanos go bankrupt, what happens to him is ultimately much less important than what happens to us. The important thing now is for any THQ long to protect himself from disaster, as in a margin call. I'm not recommending anyone bail out. But anyone on margin should do the following: add cash to your account (but don't buy yet) or sell a little bit of something in your account if you get close to getting a call. Keep that margin call number at bay. All of us who have been in this stock for two years or more should not be surprised by anything the stock might do. It's important to remember that we small investors have almost no influence on the price. So don't think that you must buy some now to help support the stock. In normal times this would be a fantastic buying opportunity. But the stock is definitely under attack right now. Our big day will come soon. We've had two painful slides from 39 and the slide may continue, but when it ends, the snap-back will be significant. Q. Can anybody get a prospectus for the Kynikos Fund? I'd be interested in seeing exactly what position Chanos holds, and what his recent transactions have been. Q. Can somebody post a detailed (and calm, please) reply to Greenberg on his message board? It would really be helpful I think if a link to last Qs CC could be provided--especially if you could link just the part where Chanos talks and BF shuts him up. If Greenberg could just hear that, it might make a difference in any subsequent column on THQ, assuming that he is honest and not being bought off. Good luck to all.