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Microcap & Penny Stocks : ACRT about to move to new highs -- Ignore unavailable to you. Want to Upgrade?

To: Jonathan Cleveland who wrote (5511)	5/13/1998 8:09:00 PM
From: Mr. Pink	Read Replies (3) \| Respond to of 7054

Mr. Pink reposts His excellent analysis from Yahoo (He prefers the Yahoo thread, although the participants are barbarians, the management of the staff is not as prone to censorship and "Nannyism" as the webmasters on SI, with all due respect) As expected the longs have no idea what they own. They spout off some astronomical multiple of forward earnings estimates that were not taxed and produced by joke analysts that no one has ever heard of with definite conflicts of interest. Actrade is in two distinct businesses TAD or "Actrade Capital" and the Trade Business. Even Mr. Aharoni has said that the company plans to focus on the TAD business as the engine of growth so Let you and Mr. Pink look at them seperately. It is not unusual to value a distribution business such as Trade on an EBIT multiple basis. 6--7X is a generous multiple for a company that is a stable but consistent earner. In the most recent quarter TAD earnings were a paltry $145,209. (you have to back out the last 2 quarters from the 9 mos numbers just releasee.) that means that since Net Income was $1,107,219 then the Trade busines generated $962,010 in the prior quarter... so the run rate at the Trade business in 3.8MM That is 4X last quarter. Since the offshore business pays no taxes Net Income equals operating income so 7X effective operating income $27 Million for the Trade businsess. Back that out of the market value of $122MM and you get an implied value for the TADS of $95 Million. Even if TAD earnings Double next year to $1.2MM, You are paying 79X earnings. Only a fool would do so. The whole business is worth, in a best case scenario 3X book value or $7.23/share. Take out criminality and the investigation and the Hell Mr. Pink's affiliates have in store for this company and you might have a goose egg. Mr. Pink would be happy to entertain other opinions rooted in fundamental analysis, not in stupidity, wishful thinking for a short squeeze or fantasy. Mr. Pink By the way anyone figure what happens when all the Reg D stock comes to market in just 2 months after the 1 year period expires. What's the opposite of a short squeeze? A crash? MP