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PGNT - Paragon Technologies


rukawa
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They are a small company that bought a much larger company Columbian company called SED International de Colombia (SEDC) for $1.4 million. SEDC distributes computer and technology systems in Colombia  and Latin America.

 

So now we have Paragon Tech, a 2.4 million mcap company and yet its statistics are those of a company 10 times as large:

 

Mcap = 2.4 million

Revenue: 50 million

Current Assets: 29 million

Liabilities: 24.6million

NCAV/share = 2.6

share price = 1.2

 

The stock represents more of a mutli-bagger type of speculation than a real investment. The whole situation is odd. How do you buy a business with 50 million in sales for 1.7 million unless the business is going bankrupt?

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  • 1 year later...

Any thoughts on why they own two $750,000 condos in Las Vegas? Operations are in Easton, PA and Colombia, Sham Gad lives in Athens, GA.....why do they own Vegas condos?

 

Sham still lives in Athens GA?

 

I was aware of the Vegas condos, and this is the one of the main things that prevented me from buying in.  The time to have been buying property in Vegas was YEARS ago...not so much now.  I would also think that the biggest percentage moves are going to come in the lower end properties...not so much in the $750k properties.

 

If PGNT has excess capital laying around, why not pay down debt OR build up the balance sheet?

 

I think what is going to happen is that Sham is going to the money coming in from the companies and re-invest in whatever grabs his attention.  As the years/deals go by, some are going to be turkeys, most probably "so-so", and hopefully a couple/few will be huge hits.

 

It would be FASCINATING to see the deals Sham took a pass on!

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Anyone know which buildings the condos are in? And are they renting them on purely residential or is this airbnb type stuff? Sorry for the stupid questions. I know nothing about Vegas.

 

I believe somewhere in the reports it's mentioned that the condos are in a luxury non-gaming building. Based solely on that info, my guess is that they're in the Trump International.

 

https://en.wikipedia.org/wiki/Trump_International_Hotel_Las_Vegas

 

As to your second question, I don't know.

 

Anyway, I think this is "Biglari starting a cafe in Monaco" or "Family-controlled Hong Kong company buying residential properties in various European cities" level capital allocation.

 

 

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hey all:

 

I don't think the properties are at the Trump building.  Not 100% sure...

 

It will also be interesting to see if PGNT holds it's sudden gain.  The stock & volume was off a bit today.

 

My guess is that it drifts back down, but not all the way to where it was.

 

If they can keep posting earnings for a few more quarters, then we might get a sustained higher price?

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  • 1 year later...

Sham Gad was on Planet Microcap #141 podcast today

 

He described the buyout of SED (I assume) as a restructuring and that he took the company from 10M ARR to about 100M ARR.

 

The latest 10-Q is here: http://pgntgroup.com/wp-content/uploads/2020/08/PGNT-Q22020.VFinal.pdf, nothing has been filed at SEC.gov since 2008 (OTCBB I guess).

 

The gross margins are ~ 10%. The short term debt is 8X the market cap (~ 32M) and of that, nearly 19M is accounts payable.

 

The expenses a little bit of SG&A and nothing else, which is then gets you to a low P/E. I find it all kinda weird but I don't know anything about the underlying business (is it paragontech.com ?). 

 

He described the two condos in Vegas as "we have a subsidiary that owns real estate in Las Vegas". Seems a tad of an embellishment.

 

SEC filings show him to have gone activist on at least a couple of fronts:

 

AeroCentury Corp. (NYSE: ACY), where he was trying to get board representation and has turned acrimonious:

 

https://www.sec.gov/Archives/edgar/data/90045/000110465920108878/tm2031833-1_dfan14a.htm

 

And something to do with Rubicon Technology, Inc (Nasdaq: RBCN)

 

https://www.sec.gov/Archives/edgar/data/90045/000114420416108920/filename1.htm

 

Still looking around that one.

 

I read his book many years ago and liked it, recommended it to a friend to learn more about value investing.

 

Don't think I'd invest in this though. Not until I understood it a lot more, like what exactly that anchor business is exactly.

 

 

 

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