Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : TAVA Technologies (TAVA-NASDAQ) -- Ignore unavailable to you. Want to Upgrade?

To: gamesmistress who wrote (21166)	7/27/1998 1:20:00 PM
From: j g cordes	Read Replies (2) \| Respond to of 31646

What was the buy in price RENN paid for its 1 mil shares of TAVA? If Drobnic's argument is reasonable then the current floor on TAVA should be above RENN's.

To: gamesmistress who wrote (21166)	7/27/1998 1:26:00 PM
From: JBH	Respond to of 31646

Thank you Gina, Thank you Karl, My best guess was the warrant conversion as to where all this paper was coming from which may have been part. This is good! It blows the short theories out! Not that I ever doubted. By the way....5k, 5k, 9k and more at the ask a few minutes ago to go along with all the other 3k, 4k i've seen :) nibble,nibble,nibble

To: gamesmistress who wrote (21166)	7/27/1998 1:29:00 PM
From: CalculatedRisk	Read Replies (3) \| Respond to of 31646

Gina, Excess shares? Yeah ... there are 25M shares of TAVA fully diluted. At $7 per share, that gives a market capitalization of $175M. This market cap consists of two components: 1) core business and 2) Y2K business. The core business is declining in revenue and losing money. A generous valuation would be about $40M ... lets call it $2 per share. So the Y2K business is being valued at $125M. This is not $125M in revenue, but $125M in after tax profits over the next 2 years. A "not to exceed $9M" contract, like with the LADWP, may generate close to $1M in after tax profits. It is simple arithmetic to figure out that TAVA needs to do over $1 Billion in Y2K revenue in under two years to achieve $125M in after tax profits - impossible! TAVA hopes to do $25M in Y2K per quarter ... if they can find adequate staff. If you are generous and use 8 quarters: 8 X $25M = $200M in Y2K revenue, or a small fraction of the revenue required to justify their market cap. This is why the stock price is falling and will continue to fall over the next year. Regards, Bill