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Microcap & Penny Stocks : Tokyo Joe's Cafe / Societe Anonyme/No Pennies -- Ignore unavailable to you. Want to Upgrade?

To: Rock_nj who wrote (32150)	12/22/1998 8:11:00 AM
From: alruss	Read Replies (1) \| Respond to of 119973

UBID/MALL from H. Greenberg on TSC There's something happening here, what it is ain't exactly clear: So, here's Creative Computers (MALL:Nasdaq). It spins off nearly 20% of uBid (UBID:Nasdaq), with the promise that it'll spin off the rest (7.3 million shares) six months after the IPO. In theory, then, the two stocks should trade at some sort of spread that doesn't change until the next spinoff occurs. Or so says one of this column's savviest number-crunching sources. According to this source, Creative should be valued, in the very least, at something like 80% of uBbid's market cap divided by Creative's shares outstanding (or about $58) plus $5 for Creative's ongoing biz -- right around the 52-week low for Creative. "Under any circumstance, on any given day, you should be able to get out a calculator and say that if uBid is at 'X' dollars, this is where Creative ought to trade," he says. "Creative's investors own those securities. They're tradable, liquid assets." But you wouldn't know it from the way the two stocks traded yesterday, with uBid rising 31, or 58%, to 84 1/8, while Creative jumped a mere 6 1/2, or 22%, to 35 3/8. "Creative owns 7 million uBid shares that are worth $588 million. These are shares they'll give to everyone, but the market only wants to pay around $310 million for them," based on yesterday's closing price. Why? Our source doesn't have a clue. His only explanation: "It's the insanity of this market. Guys are moving one piece of paper, and not the other. It's the damnedest thing I've ever seen."