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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Jeff Bond who wrote (10035)	2/27/1999 3:19:00 AM
From: Todd D. Wiener	Respond to of 14266

Okay, here's my idea for the cash. If THQI can make $3.40 in 1999, that's $40 million in cash. Add that to the $50 million they'll have in 2 months, and that's $90 mill. Add the $20-35 million credit facility, and THQI will have access to over $100 million in cash in a year. That's a whole lot for a company with a $250 million market cap. All right. Here are the suggestions for THQ in 1999: 1. Using cash and stock, make a blockbuster acquisition of a strong PC developer, like id Software. This would solve the PC revenue situation, it would raise THQ's profile significantly, and it would significantly expand THQ's development capabilities. It would also allow THQ to enter a completely new genre. The added bonus is that THQ could receive royalty revenue from existing publisher licensees, like ATVI and GTIS. And all future games could be published by THQ. This would be a great boost to the OEM business. 2. Secure two exclusive, multi-year blockbuster licenses (a la WCW or Rugrats). Examples include (these may be taken, but they're just examples) NASCAR, Marvel or DC Comics, Star Trek, Star Wars, Disney, etc. 3. Sign distribution deals in new territories, or expand Rushware or THQ International's presence in Europe and ROW. 4. Focus development teams on becoming one of THE key publishers on the Playstation 2000, and secondarily on the Dreamcast. 5. Develop a really good e-commerce website (not like the weak one they currently have) and offer PC games that are available exclusively for sale online. This way, THQ won't compete with retailers. And the games can sell for less than comparable games would sell in stores. This would increase unit sales. And the greatest part is that the gross profit would be much larger, since THQ could sell the titles for higher prices than the wholesale prices they typically get from retail accounts. 6. Develop some type of WWW presence in the gaming world. Maybe this means establishing a free gaming site, or even acquiring and rebranding an existing site. This could support advertising from other vendors, and it could promote THQ's games that are available only on THQ's website. THQ could advertise for its gaming site in its retail game inserts and in gaming mags. Those are my suggestions. That will certainly use all of THQ's available financial resources, but it will allow THQ to reach well over $400 million in sales in 1999, and perhaps $600 million in 2000. Maybe by 2001 or 2002, THQ will be second in size only to EA. Wouldn't that be an amazing story! Okay, I'm dreaming a bit, but if any management team can do this, Farrell & Co. can do it. Remember, it IS possible. And one thing I've learned with THQ over the past several years is that anything is possible -- and achievable. Todd