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

To: Grantcw who wrote (25926)	2/5/2007 11:19:01 PM
From: a128	Read Replies (1) \| Respond to of 78525

Well, Im disappointed but not really surprised that the entire 472,000 shares are being bought back at the $4.80 low. There are 6 holders with over a million shares total. They simply have no chance to sell in the open market. I got & glanced through the 10k & proxy recently and although Im not a CPA and I do have A.D.D., I believe things will be better going forward based what I read. It appears the whole walmart fiasco cost them heavily and I think they would have shown a nice quarter without that screw up. Insiders didnt tender a single share. They dont own a lot directly but have a boatload of options that are "in the money" so I have to believe they are acting in their financial best interests. I believe the company will be sold eventually. And the excess cash was of no use to them. Buying back the shares at $4.80 is accretive to book value. The other thing that suggests things are going well is the officers have been getting nice raises & bonuses. Im hoping that means things are going well but it could just mean the board of directors make the keystone cops look competent. (Something Ive wondered for years) I sold about 17% at $5.20 and didnt tender any because I was hoping that it wouldnt be fully subscribed and they would only get a portion at $5.30. I expect the stock to show some weakness, it already has. But, I believe there will be a time within the next 9-24 months where we will have a liquidity opportunity for more than $5.30. How much more depends on earnings. Or perhaps EBITDA. I recall a stock I used to own called Pure World that did what SPOR did...hired an investment banker. Later let the deal expire with nothing being done, then returned to profitability and then sold out at about 3 times the price. Im hoping something like that could happen here. Although I dont think $15 is in the cards. Read the 10k and give me your thoughts. SPOR has historically been pretty illiquid and a little buying or selling can move the stock more than you would think. My plan is to buy on weakness and sell on strength although I will maintain a position waiting for an eventual endgame. A buyout by a strategic or financial buyer is my guess. One thing that struck me as odd as Ive never seen it before. Page 35 of the 10k says "On 8/28/06, the BOD accepting the CFOs surrender of the title of Controller, an officer position. He will continue to serve as CFO, secretary & treasurer. The company hired a controller as a non-officer position to provide assistance in the accounting department." Is this just a nice way of saying he had too much on his plate and they hired someone to help him ? Never seen it before. As for the thing with walmart, my reading of it is that without the losses incurred for that fiasco, they would have had a nice 4th quarter. Those losses wont be there going forward. That, and the payraises for officers along with NO insiders tendering suggest that patience is in order here. The board may be incompetent, but they have a big financial interest...mostly via options and they hired an investment banker. My guess is returning to profitability and then selling the company is the plan. Just to get an idea where Im coming from...I would be happy with $7.00 in 18-24 months. Although I hope for more.