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Microcap & Penny Stocks : FAMH - FIRAMADA Staffing Services -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (6108)	3/13/1998 3:51:00 AM
From: JIN CHUN	Respond to of 27968

Sam, sorry to butt in, but I'm up late so anyway... The problem as I see it is the exchange. I truly, and honestly believe that a fair valuation of this stock based on fundamentals would be around $2-$3. However, I think that the chances of reaching that valuation on this exchange are next to nill. From what I understand, the merger target is not doing any business, does not bring liabilities, and has a small amount of assets. There will be a slight dilution I believe, but a point that some have been missing is that the conversion of shares 4 to 1 also comes with an upward conversion of the eps, both for '97 and more importantly for '98 at nearly 1 to 4. I also do not believe there will be any diversion. FAMH will remain the same company, with the same earnings that they would have. What will change is that the float will be reduced, there will be wider exposure, access to institutional investors, and a fairer valuation of the share price. I don't think that any reasonable person could say that industry multiples would put FAMH as fairly valued now. FAMH doesn't change, IMO, but the target does. The industry, the contracts, etc, all remain the same as before, except the investment that we've made gets a fairer chance to be fairly valued. Jin.

To: Sam who wrote (6108)	3/13/1998 3:52:00 AM
From: Sam	Read Replies (1) \| Respond to of 27968

OK, we should have enough information to guess who is the target. By digging through my notes, this is what I have : 1/ target is a holding company not in our industry (as per Reuters report) 2/ no debt (as per CC) 3/ may be around P = $2-3 (delisting factors + 1/4 ratio, as per CC) 4/ may be in Minneapolis (hinted during the CC) 5/ EPS=0 (as per CC) 6/ Small number of shares outstanding (as per CC) 7/ close to being delisted from Nasdaq (as per CC) 8/ Sales around $20m (by deduction, ira said post-merger cy would be a 100m co, and ira's last projection I had noted were $80-$90m (last week), and PR of Feb 24 mention $75-$80mm) Tell me if I made an error. I am sure somebody here has studied a company with a similar profile....