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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: KevRupert who wrote (12079)	2/19/2001 1:17:10 PM
From: TimbaBear	Respond to of 78525

No Problem Advalorem! I make many mistakes and this time could have just as easily gone the other way! I went to the 10Q as promised and here's what I discovered....As of the end of the period(9/30/00) CEGE had 9,704,136 shares of ABGX remaining available for sale, valued at $80.81/share for a total valuation of $784.2 million(listed as a separate line item under "Current Assets"). Subsequent to the end of the period but still listed on the 10Q they sold 750,000 shares in a private placement for $70.00/share for a total of $52.5 million, leaving them with 8,954,136 shares of ABGX still in inventory. So, 784.2 - 52.5 = $731.7M as the valuation carried on the books at that time. Not remembering what numbers I used, I went back to my spreadsheet to see what adjustments I might need to make. I discovered that I only had one entry under "current assets" and that was for cash in the amount of $589.57M. So, if I take the other current assets items from the 10Q of: Cash $59.26M + Short term investments of $172.59M + Prepaid expenses of .89M and subtract that total from $589.57 I get that I must have valued the ABGX shares at $356.83(must have been one of my clever days!). Therefore the only difference to my NetNet valuation of CEGE (based on the ABGX issue) would be to reflect the difference in the value of Friday's closing price for ABGX of 33 11/16 and the valuation I gave it of about 39 7/8. I haven't decided whether I'm going to do that or not. It would mean reducing the NetNet valuation of CEGE by $1.62/share to $13.85 but I haven't thought through whether I want to do that mid-stream(between filings) or just wait now until the new report is filed and CEGE also takes the big hit for the reduction of market value of ABGX and the corresponding tax benefits to partially offset it. Timba