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Biotech / Medical : Oxford Health Plan (OXHP) -- Ignore unavailable to you. Want to Upgrade?

To: robt justine who wrote (358)	12/7/1997 3:43:00 PM
From: Michael Burry	Read Replies (1) \| Respond to of 2068

Robt, I appreciate your comments. With respect to a framework, OXHP fits into a framework very nicely developed by Ken Fisher - a Super Stock hitting a glitch. This also fits with Graham, who observed the markets overpunish litigation. Buffett agreed with Graham here and felt the market's reaction could create buying opportunities in otherwise solid long-term stocks. Fisher observed that in the absence of earnings, for example during a "glitch," one can judge the popularity of a company based on PSR. IOW, when nothing is certain about the bottom line, the top line is still fairly predictable. If investors ignore continued top-line growth and continue to revise the PSR downward, that is a sign of significant disfavor. The theory goes that with top-line growth persisting, a floor develops on the PSR even amidst all the disfavor. In such a setting, the most likely direction over the long-term is upward. Requisite are that the stock is a former high-flyer with a significant analyst following that has fallen 50-90% due to general analyst scorn. As popularity returns, the PSR is bid up, earnings reappear, and old PSR levels are hit at higher revenue levels. If one buys at a PSR <0.40, and the stock gets back to 1.6 several years down the road when revenue is 50% or higher and profitability is returning, you have a 2 or 3 year 5-10 bagger. Hence, a "Super Stock." This is a pretty powerful concept, but it is key to understand which companies have the financial and business strength to survive. As we know, OXHP is going through a lot right now, and it is hard to imagine many companies more unpopular than OXHP. The PSR is in the basement, revenues are projected to continue growing even by mangement's very conservative estimates, and I at least believe management that operations will be profitable next year to the tune of >$1.30. In fact, increasing revenues in the face of a crisis is a sign of significant strength. I will be watching the top-line closely over the next year or so. For OXHP, PSR may be replaced by the market cap/enrollees. It looks like the buyer now owns the enrollees at less than $1000 per. I'm looking for a double in 3 years.It meets Fisher's criteria for financial strength. I'm weighted at 12% and will only by more if it hits 20 again. Re: the rumor, it was just something that I got along with the flood of e-mail after my article was published. Good Investing, Mike

To: robt justine who wrote (358)	12/8/1997 5:09:00 PM
From: Andreas	Read Replies (1) \| Respond to of 2068

To Robt. Justine, Unfortunately, I believe you're right on with respect to State of NY's inquiry. As a defendant's attorney having defended more tax shelter promoters in the 80s than I care to remember let me assure you that any government effort to get to the bottom of the problem at Oxford is disingenuous at best. Politics, personal gain and prestige is the name of the game. Always has been, always will be. The bigger the fish the bigger the trophy! And all in the guise of protecting the average citizen. Yea I know, there are a few exceptions, where a truly moral and righteous individual is more interested in the truth and personal gain - I just can't remember any. As to Oxford, I can't make any judgment as to their business savvy, skill and knowledge with respect to running Oxford, unless I camp out there for about three months. But let me suggest this, looking at the profile of the management team, there is a disproportionate number of high level executives in their thirties. Wiggins himself is only 40 or 41. My concern is that they could lack the experience and judgment typically found with a company comprised of a top managment team in its fifties and sixties. They simply haven't been around the block enough times and haven't fought enough of life's battles to deal with the current predicament that they find themselves. In addition, as is all to often the case, the enforcement of insider trading laws is shameful. Day in and day out the markets are swayed by inside information disclosed to a select few prior to being made public. By the time the public is aware of certain material facts the insiders have already bought or sold, as the case may be. made their profits and run. This is the nature of the game and everyone on wall street knows it. It's human nature and all the regs. and statutes in the world aren't going to change it. If, for example, anyone thinks for a moment that Wiggins and his management insiders didn't tell anyone that they would not attend last week's meeting prior to the general public finding out, thereby allowing the insider elite to sell, then they are incredably naive. Even as I write this there are people at Oxford, and the CPA firm who have a pretty good idea what the results of the audit will reveal. Good or bad - they know, or at least have a pretty good sense of what the ultimate result will be. And guess what? They are sharing this with whoever; and very likely engaging in insider trading through third party relatives, acquaintances etc. and making money. C'est la Vie! The answer? I'm not sure. But I can tell you this, class action lawsuits such as those brought against Wiggins and others, all too often tend to reveal the dirty truth. Every plaintiff's lawyer out there knows that wall street is flush with material non disclosure and material misrepresentations. The issue - whether or not there has been enough financial loss resulting from the alleged misrepresentations to justify litigation. And guess what - those plaintiffs lawyers believe that they have got themselves a live one here at Oxford. In the meantime, take a long-term view and try not to get too upset by short-term facts which are disclosed long after they should have been.