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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: ted birnbaum who wrote (11534)	7/15/1998 7:22:00 AM
From: Pancho Villa	Read Replies (1) \| Respond to of 18691

ONHN: I spent some time in their site and think they have done a very professional job. IMO this site has great potential, if they grab the lead there is plenty of potential for advertising revenue. Also, they are associated with some pretty serious people in the Medical field. Read this: onhealth.com ...Continued Goodman, "Some of the world's largest pharmaceutical and consumer product advertisers, such as Hoffmann-LaRoche, Hoechst Marion Roussel, Glaxo Wellcome and Procter & Gamble, are supporting our efforts; we look forward to working with them as the site gears up for a sweeping redesign and relaunch slated for early summer. ... ...OnHealth.com is an award-winning Web site that is a resource to consumers looking for reliable information on health and wellness issues. The site delivers in-depth feature materials as well as news and information from deep-database and rich reference materials such as HealthNews from the Massachusetts Medical Society, publishers of The New England Journal of Medicine; and an exclusive, comprehensive health guide with more than 300 conditions and diseases. Underscoring its commitment to becoming the premier network of health-related channels over the Internet, IVI Publishing, Inc. recently announced its plans to change its name to OnHealth Network Company, pending shareholder approval. ... IVI Publishing, Inc. is an electronic publisher of interactive, multimedia health and wellness information. IVI delivers its content via the Web at www.onhealth.com and over America's Health Network. IVI's content alliances include Time-Life and the Massachusetts Medical Society, publisher of The New England Journal of Medicine and HealthNews. In addition, IVI provides content and Q & A video clips featuring leading medical specialists for America's Health Network, a 24-hour health and medical cable network. Check out the list of Medical Advisors: onhealth.com Look at this impressive list of conditions and how thorough the info. is: onhealth.com I wouldn't dare betting against them. From my very limited research it looks like they have a good chance to grab the lead despite the large number of sites with the same orientation: yahoo.com Companies with some pretty deep pockets could start advertising heavily. But then again I may be wrong, and my opinion may be colored by having been burnt enough shorting internet stocks. Pancho Pancho

To: ted birnbaum who wrote (11534)	7/15/1998 9:01:00 AM
From: JGarly	Read Replies (1) \| Respond to of 18691

Teb thanks for the heads up on ONHN. I can add a couple of observations to your analysis. 1. After the injection of cash from the placement of the convertible stock ONHN now sports a higher book value per share than AMZN so that obviously isn't a concern for investors :-) 2. Your pump and dump assessment looks reasonable. Though if there are blocks going off it is probably a broker pushing it rather than a newsletter hypster. 3. Terms of the convertible would seem to favour the holders waiting a few months before any arbitrage. The discount to market increases to 5% on Oct 8 and to 10% on Jan 5. 4. Advantage Fund II(investors in the convertible). I only remember encountering these guys once before in this type of deal. That is in TERA where they have held a similar investment for several months without engaging in the aggressive arbitrage that is so beneficial to short sellers. 5. You're right about this company bleeding cash. According to recent sec filings they have enough cash to last only until the end of the year. This will mean another round of financing in the near future, which could also help to explain why the convertible holders are not trashing the stock yet. 6. short against the box. No need to on this one, it is on the nasdaq small cap market so no uptick is required to short it. In summary I'd have to agree both with your assessment of short term direction and ultimate fate. Looking at the mm screen this morning before the open I see HANF alone at $9. Has he been responsible for moving this issue along? Who has been featuring prominently? Jon

To: ted birnbaum who wrote (11534)	7/15/1998 3:25:00 PM
From: F. Lynn	Read Replies (1) \| Respond to of 18691

Here's an interesting short: SCTR, Speciality Teleconstructors. Formed to build cell towers, now merged with a Hick Muses company to own and lease his towers. Among the red flags: 1-insider selling: budagher, former ceo od sctr and now coo ofÿ the combined copany, filed to sell 200,00 shares on june 24. this info is not on yahoo but it is done. tommie carpenter also filed to sell 100,000 shares, one of the owners of a company sctr bought last year. 2-huge runup after merger announcement:Omni-America consists of tower assets that were purchased for a sum total of about $115mm ($75mm for original assets plus $38mm for recent Arch towers). So basically assets that Hicks-Muse bought for $115mm are now being valued by the people who are paying up for the stock here at $380mm, or $265mm more than Hicks-Muse paid for them. never a good thing to be paying more than a buyout firm. 3-incredible valuation: shares trade at about 125 TIMES estimated after tax cash flow. and the only estimate is from alex brown, who picked up after the merger was done. the report is total fluff. on a comparative valuation, it is just as ridiculous. Their nearest competitor, LCC International, trades at a much lower valuation. LCC now has more towers than SCTR, plus another real business that generates significant cashflow (~$25mm EBITDA), and still has 1/2 the valuation of SCTR. 4-sandbagging shareholders: on the most recent quarter they did not put outa press release, just filed a 10Q. here are some quotes from the 10_Q:"...As the Company focuses its resources on tower ownership, revenues fromits construction operations are likely to decline. Management believes thatthe decline in revenues from its construction operations will be mitigatedover time by the recurrent revenue stream expected from tower ownership,including revenues from the transmission towers acquired in the OmniAmerica Holdings Merger." Now keep in mind that in 9/97, when they released their fiscal year, the then CEO, Budagher said, "...we did see demand begin to slow somewhat during our fourth fiscal quarter....we believe the slow down has continued into the first quarter of 1998." And they said from the 2/97 10Q "Management believes the decrease in revenues was due primarily to unusually strong demand for the company's wireless infrastructure components in the comparative quarter last year and to Management's decision to concentrate its efforts on improving operating efficiency by, among other methods, reducing the number of projects it undertakes using primarily subcontracted labor." Translation: So the PCS buildout dries up and... And then they suddenly announce they are merging with OmniAmerica, the Hicks muse company? Sounds pretty desperate to me.