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

To: Carl Yee who wrote (1112)	6/2/1998 5:06:00 PM
From: Q.	Read Replies (1) \| Respond to of 2506

re. PAMCE's news release, the phrase 'The investment is in the form of a convertible note which upon conversion will give the investor a 17 1/2 percent aggregate interest in Insurion Inc.' is not typical of deals where the new common is flipped rapidly into the open market. It suggests that somebody is considering a longer term investment. We'll see if they file a registration statement. Meanwhile, I'm beginning to suspect the NASD isn't going to delist them for not filing a 10k on time. When I called a couple of weeks ago, I was told they were waiting to hear, and that they still expect to file in June, just as they had said several weeks earlier in a news release, and presumably as they had said in their petition to the NASD. It sounded fairly plausible to me that they will file in June. Well, it's June now, so I can't really see the NASD delisting them just a week or so before their long-promised filing. If they've given them this long, and their promise sounds plausible to them too, why not give them another couple of weeks? I shorted PAMCE primarily on speculation that they would be delisted for the delinquent filings, and secondarily because the stock seemed to trade at a significantly high multiples compared to the insurance industry as a whole, even though PAMCE is a lousier-than-average insurance outfit. With a book value that will soon go darn close to zero, the p/b multiple will really look high, so maybe that's something. Just the same, there's no immediacy in how quickly the stock price might revalue itself based on fundamentals. A delisting is the much more rapid sort of thing I would rather have. Soon I've got to decide whether the valuation is good enough a reason for me to be short, all by itself, without the specter of delisting, or whether I should be disciplined and just get out when the story didn't unfold according to my original plan. EQMDE might be a different story ... the lack of the NT-10Q makes their situation look worse.