Replies to post #47903 on Hannover House Inc (HHSE)

[nsomniyak]

that kind of potential is why we are here.

I am not yet comfortable with that tight a linkage between library value and stock price. The library has to be valued in terms of the future income streams it might produce, but I think it takes a while to monetize those assets.

However, I would think that the audit would establish that the library CAN be valued by some kind of consistent and rigorous method, and provides credibility. With the exception of anything coming out of Terminator 3D, the titles HH has are, shall we say, obscure. DVD geeks might appreciate them, but most of them are completely unknown to the general public. We're not talking Gone With the WInd or The Godfather here.

The audit would also provide some insight into the deal-making skills of EP and his team. Hopefully there is a significant, positive difference between the audit value and a book value derived from the purchase price less some level f depreciation. If so, this suggests that EP had a nose for value in acquiring these titles, and suggests that future property acquisitions will be done at favorable levels price vs. value.