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.

Strategies & Market Trends : Bill Wexler's Profits of DOOM -- Ignore unavailable to you. Want to Upgrade?

To: Bill Wexler who wrote (4478)	2/18/1999 12:37:00 AM
From: Victor Lazlo	Respond to of 4634

went short today on ptel, at 15, my limit order was not fully filled (darn!). This co will lose net $11 per share this yr if all goes well. Their annual interest expense is half of annual revenues. This is a golden opportunity for shorts. My 2nd go-round w/ptel. On my 1st short trade, last summer, I made about 27% in six weeks; Had I held another four weeks, I would have doubled that gain on the ptel short. i also tried to short Clear Channel (ccu) big time earnings slowdown, and they are acquiring Jacor, a debt-ridden co with a pe of 700. It went down, but I will try again tomorrow. Omnipoint is another good short. Unbelievable lousy finances. I may try it also tommorow. i feel we are in the early stages of a mean correction. Victor

To: Bill Wexler who wrote (4478)	2/18/1999 2:53:00 AM
From: Bill Wexler	Respond to of 4634

CPU now valued significantly less than Computer City. CPU paid approximately .35 x sales for the Computer City chain. The remaining Computer City stores have now been turned to profitability and the entire CompUSA chain is profitable. The entire CompUSA chain now trades at roughly .15 x expected FY 99 sales. Several posters on the Yahoo board have speculated that the stock will sink to 7 a share. While possible, this raises an interesting hypothetical situation. At 7 a share the company will have a market cap of roughly $630 million. This means that Tandy should consider buying the entire CompUSA chain. After they cancel the promissory note for the CC acquisition (since Tandy is the original maker) and extract the cash (remaining liabilities and payables are easily manageable from existing cash flow) that means they get the entire chain including the (now profitable) Computer City stores for about $200 million more (net) than what CompUSA paid for Computer City alone. To put it another way, Tandy will end up coughing up about the same amount of money out-of-pocket for the entire CompUSA chain (+ the Computer City chain comes back for free) than what CompUSA paid for Computer City alone. Not a bad deal! CPU is grossly undervalued and will eventually trade significantly higher.