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Re: [sharechat] Interesting Article on P/E ratios

From:	"David Reid" <aspex@ix.net.nz>
Date:	Thu, 25 Jan 2001 14:44:49 +1300

You are always at risk with poor gearing.

Example is a company called Deep Sea Leisure (possibly similar field to Aquaria21)

Gearing 252%. Price in 1999 was 263p and now is 33.5p with a PE of 3.8 and NAV of 79p.

It is still earnings positive but has just had to suck its shareholders dry with a 1 for 1 at 30p. They were unable or unwilling to use an underwriter and after various actions were still unable to place all shares.

Thats the risk.

No further comment.

David Reid

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