Replies to post #2904 on Deaf-Talk Inc. (fka MGQG)

[pinkyringcapital]

Townscapes, not a problem.

I am estimating $20 million in revenues

Profits, I really have no idea but $500,000 annually keeps appearing to me in a dream but sometimes it's $250,000.

Several things just don't "add up" for me about this company. One I've already mentioned is that they have no in-house CFO/accountant. But they could just farm the entire accounting work for the company to a third party. I can honestly say I've never seen a larger company do this but there's a first time for everything I guess.

The main reason I don't think they're super profitable (as you suggest) is the reverse merger itself. I know from talking to the company myself that one of the reasons they went the RM route instead of simply going public was that someone convinced them that it would be cheaper to do it that way, i.e. buy the shell of an existing public company. Now, I really don't know what the legal fees would be to become public from scratch but how much could it possibly be? $100,000? $200,000? $300,000? Anyone with an idea here? I'd like to know. Anyway, let's use $500,000 (seems super high to me) as the cost to go public from scratch so going with a RM is cheaper. Or is it? If they go public from scratch guess who owns 100% of the company? Correct, management owns it all and then would sell some of their shares to the public, probably via an IPO. But my point is that management gets to keep ALL of the value of their company either by keeping stock or getting the proceeds (less expenses of course) of the stock they IPO.

Now, lets look quickly at the RM. I think there is roughly 8 million shares in the "float" according to what we've been able to determine. Management doesn't own those shares. So if the stock's worth a dollar didn't management just piss away $8 million dollars? Heck, let's use a 25 cent stock price and they've still pissed away $2 million. There is no possible way the RM can be cheaper in my opinion.

Unless...they don't have the $500,000 (or insert your cost guess here) to go public from scratch and so they were willing to give up a chunk of the company (a really really large chunk) which costs them ZERO in cash up front to go public....hmmmm.

So...this is what leads me to believe that they don't make a million bazillion dollars a year or they would have just gone public from scratch instead of the RM.

So, there you have it, lol. My back of the envelope thoughts. Pretty sophisticated huh?