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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Q. who wrote (1075)	5/15/1998 10:29:00 AM
From: Q.	Respond to of 2506

more on PAMCE - I spoke with John Gillin, the outside director (who, curiously enough, answers the phone when you ask for IR). He told me that they are 'still shooting for June' to file the 10k. I asked how things stand with the NASD and keeping the stock listed. He said: "We're waiting to hear. We appealed two weeks ago, and we're waiting to hear from them." my comment -- So it sounds as if the process is that the NASD sends a letter one month after the 10k is due and gives the co. an opportunity to appeal. I would guess SWSHE went through this process too, and already heard a negative response from the NASD. I asked whether the loss for 97 is still anticipated as being about $20 M, and whether that would take shareholders equity down to about $2 M. He said the loss would be a range with $20 M at the upper end. He wanted to emphasize that those figures are for GAAP accounting, vs. another type of (cash) accounting used in the insurance business. He said that using the insurance-style accounting, their equity would be $17 M, and that this would be unaffected by the writeoffs of goodwill etc. that were now being carried out. Thus the writeoffs will NOT affect the insurance company's rating with A.M. Best, which was raised to B in the last year. I went ahead and executed a small short order. I got an execution within 1/8 of the ask, after failing to get an execution at the ask. So the wide spread isn't that much of a problem after all.