MSGI:My calculution came to $1.00 based on 26% more to bottom-line, but that is based on fully diluted which means increase of outstanding by double.

If it works as you think, then this should be your biggest position. It is my 2nd biggest.

sam

msgi:vphm I can see up to $1.00/share in forward earnings assuming fully diluted which at that point means little debt I think.

From that perspective I see $15 but to get to $30, is that based on future pipeline?

What is your opinion of future pipeline?

sam

IPII, What price do you hope to sell at?

$18, less, more?

sam

Thanks. eom

Bobwins,

How are you thinking about San Telmo?

sam

Maybe I am being foolish.

I know in the investing world there is an excessive amount of fraudalence of some nature.

My question is why would anybody think that at this moment that NOWAUTO should be more suspect than the average small company with a short operating history.

The fact that they have not reported seems to me to be a cause for a 20-25% discount given that nothing bad is known.

Is the business plans of the company more risky or suspicious than other small companies without a history?

I feel like the answer is no, but the discount to me is the difference between $1.00 and at least $2.00 evaluation for the future earnings expectation, 50% discount.

sam

Hapslap,

If Matin was rolling in cash, he should be buying if he knows all numbers are legit. You are right.

He would not have to buy all of the company up, but if he could buy as many shares as possible at $3.00/share he should, I think $3 a likely price.

I don't think it is bullshit to not buy though if he has $100,000 in cash total of his own and a stock worth $1.5 million currently in his portfolio. You would not do it yourself then if you were trading places with him, you would shoot for options unless you were trying to shortcircuit the process to stock price increase like priming a pump. Even then you might want to position yourself with options first before lighting the firecracker.

sam

George,

Given the stock price during the period of most of escalation of shares, I think up to $2.00 per share.

The prevailing theory has been discussed before for best-cased scenario for the past shennanigans.

It is roughly as follows:

2003 trucking fiasco caused loss of total control over mills. We still are very unclear on the status of mills.

Purchase of KCA was needed and maybe some money forked over regarding mills as well, in order for the $6 million in earnings for 2004 to be true.

At time Matin stated the $6 mil, purchase was not done, mill situation was not fixed. He had to announce the big earnings to drive up stock price to then do these actions so hopefully we now do have a money machine.

This is one scenario, so it is possible should be viewed as just a false dream. I don't have a good alternative theory beyond what you suggested which is this is a real company from out of which a long-term scan is being operated.

This comes back to topic of 2005 acquisition. If Matin has used the price surge in the fall to develop a current money machine, then he could have access to some money flow to help with purchase. The other view though is rapidly expanding young businesses can legimately be something of a black hole for cash needs for some time even when profitable. The trouble I have though is why should anybody put faith in the company without more evidence than press releases to date.

sam

True enough except he couldn't buy let us say buy 6 million shares at $1.00, maybe $3.00 plus though if he is patient at best I think since I assume he would have to report. Also if over half of those shares are currently restricted, he could not get that part.

Also I don't know if he could get a loan to accomplish that. Obviously if he was not taking private but believed in the value, he would award himself plenty of stock options. If he was getting through legitimate stock options, I don't see a slamdunk for buying on open market. Maybe it is though?

sam

George,

I have never thought to ask before. Now I will.

Why go private necessarily? If you can get valued like other companies publicly, public value sells potentially at a higher pe. If Veltex could theoretically make $1.38 and convince a public it is worth at some point a pe of 20 then price is $27.60.

Worst case scenario is Matin has 1 million shares, but realistically at that point I say minimum 1.5 million shares.

If Veltex could hit big in public arena as described, he is worth $40 million. So why would it be to financial advantage to be a private company?

sam

Growth and Value,

I do consider it possible that this stock should be valued at $6 plus or anywhere between current price and that.

I also consider it possible that this stock's price long term is headed lower. The fact that there appears to be some good customers makes me think overall that this is a decent speculation/ but don't put too much on it.

I consider talk of a major acquisition at this time as negative, because of stock price as I have explained. Actually that is the 2nd piece of bad news in today's press release in my opinion but it was mentioned before.

If this acquisition is done without a vast share increase, it could be great news but without details ...

Simple math I am okay with 30% share increase if I truly believe 30%+ more profit as everybody can agree.

sam

I was not talking about being informed on the audit. I was not talking about the explanation.

I did not think the prelude had any info, it was just there to distract. That fits with Matin's known history of being deceptive.

For those who do not think Matin should be considered deceptive, should study closely past press releases going back to last fall.

I do think the U.S. sales are climbing from zero in 2003. Profitability I consider possible, but unknown.

sam

There was no significant news at all that I saw except more delay in audit. He tried to bury that with noninfo.

Not a trust building kinda of guy right now, his magic touch is failing.

sam

Just because it is legitimate to knock many companies doesn't make this risk anything less than the risk it is.

Best case honest scenario is nobody knows what this is worth. Worst case actually also is nobody knows in market value, except the historical trend longterm is down.

This is a risky stock, but the upside is potentially more than most blue chips but if this stock has moves up take some profits or reduce losses.

sam

Mushroom,

By all means it could have been a beneficial deal for both Veltex and KCA. A deal now could also be beneficial.

The problem for holders of Veltex though means the stock is not worth what supposedly earnings would indicate.

It could mean as an example down the road if things go good in theory a price of $2-3 perhaps instead of down the road $6 plus.


sam

All,

Please remember that the stronger the case is for an acquisition being worthwhile when using shares at $1 means the stronger the case that the current company can only be worth $1, which may be the truth, the company may intrinsically be worth $1 instead of $6+ if the truth was totally clear.

Stick with some math. It is clear. If a company truly should be worth lets say $10, then company does not make purchases where the stock is worth at moment $1. Current trading price would not be valid to use for acquisitions if that price was out of whack by a factor of 10 and can be corrected first and ceo knows it.

That is why everybody knows that Matin knew company was not ever going to be worth $20-$40 share before the 5.5 million shares were issued.

Also don't discard the idea that Matin may still be less than honest as well. He was not honest on the $3 earnings. He knew it was bullshit. Be a realist. It could not have been the truth. If it was, the acquisition would not have been done then. The price of stock now would be $20-$40 at least, no acquisition needed. Just like right now no further acquisition would be needed for this stock to reach a minimum $6 if 22 cents totally legit.

sam

Growth and Value,

Everybody needs to wake up to the status of this company. The jury is out on whether this is a valid company. I have a stake in this myself since I hold a position.

Think objectively. If this company for the first qtr earned 22 cents, then conservatively this stock should be valued at $6/share.

If Matin uses this stock to make acquisitions where the stock has a purchasing power of about 1/6 of that then it needs to be an extraordinary return on such a paltry price per share. This is fundamental business sense. IT would make a HELL OF a lot more sense to only make acquisitions when you can get at least $3/share for your share use.

Also for Matin to address issues of ownership, a very clear 2004 audit is needed or why should anybody be a true believer.

Right now there is no room for faith, beyond yes it is a real company with some business. Whether Matin can ever come across as honourable is iffy, ie how about our great $3/share earnings last year, bunch of bullshit.

sam

I believe fully diluted = 7.9 M based on 22 cents first qtr on 1.739 M. IF actually 22.5 cents per qtr half-way between 7.55 and 7.9 m shares.

Or could be he just went with 8m plus or minus with no attempt at accuracy on actual share count.

sam

Max,

Trucking fiascos, writeoffs have nothing to do with issuing currently shares for acquisition. What the company is really worth is the issue. How Matin treats shares is the best indicator we have.

sam

Trucking fiasco means nothing in 2005 in my opinion. Either after all the share increase from 2 million to 7.5 million which HOPEFULLY was for the company's benefit, we intrinsically now have a company worth more than it is priced at now or we don't.

If this company based on what it is NOW is not worth more than $1.25/share, I see no way that it will be changed to be worth significantly more than that.

Either one is true. Stock should be valued significantly higher or it should not be. No further acquision or magic trick will change that in my opinion. We are simply waiting for time and hopefully truth with time as to what this company is worth. Truth means audit 2004 and regular reporting.

sam

Snow,

You are absolutely right. It is time for the 2005 reality check.

If massive shares are issued again at this point, logical conclusion must be those shares did not stand behind significant worth.

Rule of thumb. If Matin does not show the shares should be worth more, we shouldn't either.

Any issue of shares must be explained in an acceptable manner.

sam

To state the obvious, it doesn't look like there are any knowledgeable sellers rushing for the exit.

sam

I think this company is viewed as very risky because it is not reporting.

Otherwise, my impression is their used car business should be viewed as solid compared to many other businesses.

That is why $3 - $10 / share if they report as predicted seems right to me.

sam

I think Amex requirements could be met a lot quicker than that. Also some stocks have done quite well as bulletin board.

sam

This could mean a buy indicator for Rawnoc.

sam

My guess is you can get by mentioning other stocks somewhat, but you can't promote a stock across various boards. Probably there are rules one can review. I will bet rules are not administered completely even.

sam

George,

Why if so much coming in as Matin claimed and so much need for share increase?

I think most here believe and have for a long-time that Matin lied. His lie may be beneficial for the company in the long-term in order to raise capital. That is a maybe and it is a maybe based on whom I consider to be a known liar.

My speculation though is he doesn't necessairily want to be a scam artist. I think he could be trying to make things work and has some good skills in the business arena. Also if he wants to succeed, he did get capital to work with. Maybe close to enough capital now. All maybes.

sam

Growth,

The part inconsistent which we all are sometimes, is you briefly were very negative after meeting Matin.

sam

I am a believer that sometimes technicals are wrong. Once again the biggest justification for downside at this time would be continual rapid share increase.

sam

Interesting, since 8 million was mentioned in the last official peptalk.

sam

This would work perfectly if the market was always right. IT is not.

sam

You have to have growth, but temporarily if if if you knew 21+ cents/2nd half without cash infusion and becoming reporting was a likely reality, you would postpone extra growth and build fast wealth on the stock and then return to business growth with your new wealth. Always money should go to what gives the best yield.

sam

Makes sense. I have heard the term debt-equity swap. Of course, I believe impossible for a pinksheet stock to get.

sam

I agree at this price the stock should not be used as currency.

Bank loans would be okay though for acquiring. If the bank had a policy of loaning money to nwau for buying stock (which no bank would do I think) then the company should buy stock.

sam

I agree reporting should now be very high priority. I think though this past acquisition was the most important thing until now. It has not paid off yet for investors, but the plan is it will.

sam

My analysis of selling price was based on yesterday's trading prices, not long-term thinking. That is my basis for evaluating savvy of seller. It does not matter what the seller paid, why throw away unnecessarily a few cents/share.

Longterm I am a fundamental guy. Reporting makes fundamentals more trust-worthy on a relative basis.

Either this is a good company or an incompetent company or a fraudalent company. If anyone can add knowledge to their being incompetent or fraudalent, then the price drop will be understandable. I don't think anyone right now can make a good case for fraud.

The price was never too high if the earnings estimates are accurate.

If also they really made .03, then that supports belief in the acquisition and the estimates. I would argue a report on .03 reviewed by a good auditor would be great.

sam

I think a brainly seller would get a better price, like low 90s. Selling at 79 cents seems like a bad deal.

sam

Just read your cpe analysis eom

Bobwins,

I am not surprised that you would view stuof as a mistake, although its fundamentals have improved. Where from here?

I am surprised that you view CPE as a mistake. Why?

sam

92 cents looks like a give-away to me. Should have gotten with any patience at least 94 cents. No sales at either 93 or 94.

Trying to predict future prices I think is all about predicting future events. If at end of June no positive feed on reporting, a low price makes sense, but I think if nothing else with a major acquisition which I have not heard any bad said in my opinion, I don't see the negative long-term.

It looks to me like solid business until proven otherwise. If so reporting will come this year, this stock at end of October could be as much as $8 or heading that way.

sam