To: Fred Thornell who wrote (30171 ) 6/5/1999 11:28:00 AM From: Dave Gore Read Replies (2) | Respond to of 44908
**TSIG**... the ultimate "REWARD to RISK" decision on the entire OTC/BB? Will a $1,000 investment be worth $0.00 in 12 months? or will it be fundamentally worth $35,000 based on a PE of 20? (i.e. a $5.00 stock) THE FOLLOWING IS MY OPINION AND ESTIMATE ONLY....EVERYONE SHOULD DO THEIR OWN ESTIMATE AND EVALUATION. THIS IS ONLY A GUESS ON WHAT MIGHT HAPPEN. I think it is possible, maybe even probable, but I am still DD-ing and will continue to do so. At the current stock price TSIG is worth a small risk for me. I would never put more money into a stock like this than I can afford to completely lose. That said.... I think it is a very interesting speculation at these levels. I've been thinking. One deal, Lifetime Learning, by RG's and Lifetime's numbers and my own math represents anywhere from $63M to $1B in revenue, much of it at very high margin. $63M represents the absolute worst case scenario of student participation and student sales that Lifetime Learning would have ever seen. One Billion represents the HIGH AVERAGE expected (which is based on the below) ** 30% student participation in schools that sign up (apparently what Lifetime says is average)** ** Each student sells $30-40 average (of candy bars or whatever) ** 25-35% of Cards (sold at $10 a piece) are estimated to get used ** The average card used is used for $30-40 worth of mercandise Do the math yourself and DD it to death. Anyway I do the math, I get an EPS of 5 cents to $1.00 on this one deal alone. And that's figured on 200M shares outstanding. **** $300M revenue at high margin @40% = $120M GROSS PROFIT $700M revenue at lower margin @15%= $105M GROSS PROFIT = $225M GROSS PROFIT NEXT 12 MONTHS? = $100M NET PROFIT (after taxes)..... or $50M NET PROFIT? (help me here acountants) = $50M /200M Share O/S = 25 cents per share = Assuming PE of 20 = $5.00 stock in next 12 months based on this ONE FUND-RAISER THE BOTTOM LINE: No matter how you slice it or even if you cut the above numbers by something ridiculous like 90%, the price of the stock at these levels makes this an interesting proposition. COMMENTS? **NOTE: The above is very speculative. The one thing that I need to factor in later is what percentage of schools sign up. If only 50% of the schools sign up for the program, then the above numbers would be cut by 1/2. Will have to wait and see. Maybe I will try to call Lifetime. All Memphis schools apparently just called to sign up.