To: davedb who wrote (104 ) 1/9/1999 3:12:00 PM From: Polartee Read Replies (4) | Respond to of 666
CAVEAT EMPTOR Pretty sleasy writeup from the newsletter. Not only was this a paid for promotion but the article tries to associate its buy recommendation with Oppenheimer: "Today a Strong Buy Recommendation was issued on iSleuth.com Inc. (Ticker: SLEU) and that is why we have chosen iSleuth.com Inc. for our January profile. A price target was set at $17.00 to $19.00 per share. If you recall on 12/16/98, less than one month ago, Oppenheimer reissued their buy recommendation on Amazon.com with a price target of $400.00 per share. Since this recommendation (only 3 weeks ago)" I'd be very careful with isleuth. Of the company's 2.7 million shares outstanding there is a float of only 700,000. Over 800,000 somehow traded Friday. Of the 2.7 m shares, 1.5 m are held by SJIG (SGI Group), a company which is discussed under:exchange2000.com SJIG was profiled by FutureSuperStock newsletter last year as a promising cigar stock:futuresuperstock.com At that time it owned Maverick. SLEU acquired Maverick, which held the option to acquire the search engine and its site, by issuing 1.5 million shares to SJIG. Here is an SJIG recommendation from Fleetwood when it was at $4 (sounded great at the time based on cigars and the search engine was not a factor). SJIG is now down to only 0.20.futuresuperstock.com With 1.5 million shares of SLEU out of the 2.7, SJIG owns 55% of the common stock of SLEU. Is SJIG selling their SLEU now? The 1.5 million were restricted stock which usually means there is a holding period of 6 months or something. Maybe that period is up now so SJIG is selling into the SLEU price strength. At current price of SLEU, SJIG is therefore worth 1.5 * $6.625 = $9.9 million in SLEU stock. Divide by the 4.2 million shares outstanding according to the Futuresuperstock profile and each share of SJIG represents $2.37 in SLEU stock. But you can buy SJIG for $0.20... Sounds like a better buy than SLEU itself. Something is obviously not right here. You can never by sure with these OTCBB stocks since information is hard or impossible to get or verify and I'm no expert. Maybe the share counts are out of date or maybe SJIG is severely underpriced. Doubt it. SJIG smells bad and its tainting SLEU by association. Maybe that is why SLEU has not been taken seriously on Wall Street. I'm afraid of getting JIGged by either stock now. Something to think about. Any comments? P.S. Another red flag: the investor relations telephone numbers are the same for both these companies.